The Ukraine invasion, the ensuing energy crisis and the more visible signs of climate crisis has caused the issue of climate change to truly arrive in peoples hearts and minds. The energy crisis in particular aligns three societal objectives in one policy dimension – energy savings. Households, by saving energy, can help save money, resulting in lower energy bills, contribute to saving the environment through lower CO2 emissions and at the same time, provide a material national security benefits by blunting Putin’s energy weapon. That is to say: saving the economy, saving the environment, and blunting Putin’s energy weapon is a potential pro-growth equitable alternative. The work in this research agenda is intrinsically linked to much of my other research foci over the years.
Context: This paper essentially develops a measurement and evaluation framework through which the impact of the energy crisis and its political handling can be empirically evaluated. This will shed some light on whether policy choices were lead by the evidence and raise questions on the relative trade-offs and the implicit welfare weights that policy makers use when designing welfare policy. This project produced the data that was used in the Financial Times visual story-telling piece linked below. An open science repository explains this work, the underlying data and the analysis steps that are intended to follow over the coming months and years.
Context: This paper walks through the UK’s policy response to the energy price shock in the wake of the invasion of Ukraine. The UK’s policy response stood out as much of it was very regressive and untargeted and in many ways may not adhere with what one would consider traditionally to be “first-best”. The policy briefing quantified the likely trade-offs, and on the event discussed a range of policy options that the UK government could have implemented that likely would have been less fiscally costly and also less distortionary.
Broader coverage: Financial Times
Context: This paper showcases how spatial institutions that can trace their origins to opposition of what would become a main driver of climate change — now poses a significant barrier on (individual) climate action.
Distributional and climate implications of policy responses to energy price shocks. CAGE Working Paper & CEPR Working Paper, 🔓 Open access.
Context: This paper provides a correlational analysis of the higher dimensional correlation space casting a light on which demographic groups would likely be more exposed to by the energy crisis and how the policy interventions that were brought about by the government is limiting various socio-economic groups exposure to the energy price shock. It documents first and foremost that the energy price shock is progressive in nature, but that the intervention to lower unit prices is rendering the response much less progressive.
Context: This paper is the first in a whole series of short papers that will document the adverse effect that the energy crisis had on socio-economic outcomes across England. This particular paper documents how the energy price shock caused an increase in economically motivated crimes.
The research agenda that I set up and shared with a range of collaborators in summer 2022 will gradually unfold. The building blocks of this work have been put in motion with some randomized controlled trials, a policy briefing, an interactive dashboard, tremendous amounts of data collection. My broader title for this research agenda is the “Political Economy of Climate (In)Action”. It is explicitly left open as I would like to genuinely believe that a global consensus on action is emerging and growing. The war in Ukraine, the energy crisis and the outright visibility of the climate crisis may spur people into action to bring in motion the economic transformation that is needed.
I also firmly believe that much of what needs to be done is rethinking and robustifying our institutions. While the work in this research branch is mostly using UK data, I try to draw data in from other countries to expand the breadth and scope. The UK, in many contexts is actually championing some of the necessary changes to bring about climate action moving beyond conventional mercantilistic policies. But it is also subject to its very own political economy.