Download the report of the workshop organised by the Chair Energy and Prosperity
The Chair Energy and Prosperity organized a workshop on July 3, 2020 on the theme “Monetary policy and treatment of public debt”.
The current economic and health crisis suggests a reorientation of academic work towards economic policies to overcome the crisis. The challenge is therefore to succeed in implementing these policies without delaying the impulse for ecological transition. Among them, monetary policies have been of strategic importance since the financial crisis of 2007-2008. Conducted by the European Central Bank (ECB) in the euro zone, these policies are closely linked to the fiscal action of European governments at the national level. Indeed, when the ECB carries out massive repurchases of public debt on secondary markets, it facilitates the financing of Member States.
Rethinking the action of central banks seems necessary in order to respond appropriately to economic difficulties, without delaying the ecological transition. Cancelling the public debt held by the ECB, finance green investments, or monetising public spending, are all proposals that go in this direction. These proposals were presented successively by two researchers associated with the Chair:
Workshop moderated by Dominique Plihon (Université Paris 13, Sorbonne Paris Cité).
After discussing the weaknesses of the aggregated statistical approach to estimate economic damage, we conclude that, if these functions cannot reasonably be trusted for such a large cooling, they should not be considered to provide relevant information on potential damage in the case of a warming of similar magnitude, as projected in the case...