Conference Agenda

Natural resource revenues contribute to sustainable development when they are reinvested sufficiently in public services, such as education, that offer long-term social returns. Previous cross-country evidence suggests that resource-rich countries fail at this, spending less on public services than non-resource-rich countries do. However, extant evidence suffers from endogeneity problems and does not show a causal link between resource richness and public service spending. This paper exploits plausibly exogenous temporal fluctuations in natural resource tax revenues to assess if oil and gas revenue windfalls crowd out public spending on services that promote sustainable development. The sample comprises 130 subnational Indonesian governments that receive fees and royalties from production in nearby areas but exert no control over prices and production volumes. The analysis indicates that governments spend resource revenues productively. For instance, 36% of natural resource windfalls are spent on education (on average), a percentage much larger than the share of local taxes or central government funds that are spent on education. A geographical regression discontinuity analysis confirms the causal interpretation of the findings. When considering the broad range of government expenditures, the analysis reveals a solid proclivity to use windfalls for investments benefitting sustainable development.

The COVID-19 pandemic has triggered substantial societal shifts, shaped not only by the virus itself but also by the implementation of diverse governmental policies aimed at curbing its spread. This paper examines the patterns of energy consumption in the European transport sector and analyses their susceptibility to COVID-19 restrictive policies. Our results reveal significant reductions in rail/road transport and aviation use that showed distinct recovery patterns. Additionally, with the declaration of the pandemic’s end, it becomes pivotal to assess whether these policies have instigated enduring behavioural changes as they may play a vital role in achieving net-zero emissions by 2050. We find that the COVID-19 policies that exerted the most substantial influence on transport use were “school closures,” “cancelling of public events,” and “international travel controls.” Our results reveal diverse transport behaviour across different countries, emphasising lasting changes in behaviour in Sweden and Denmark.

The paper examines the factors influencing the allocation of EU green funds to French municipalities,

utilizing a new database and covering 980 municipalities across two multi-annual financial frameworks

(2007-2013; 2014-2020). Firstly, green projects funded by European Cohesion Policy are identified using

the European Commission green taxonomy. Secondly, the local determinants of green fund allocation for

French municipalities are explored. The financial situation, political orientation, and contestability within

a municipality are significant factors in determining the green use of funds at a local level. Specifically,

a positive and significant relationship between political contestability and the green use of European

structural funds is observed, highlighting the importance of political opposition in environmental matters.

Zero-interest green loan programs (ZIGL) are gaining traction to address the tremendous financing needs implied by net-zero emission targets. We provide the first evaluation of such a program, the Éco-Prêt à Taux Zéro, introduced in France in 2009 to encourage home energy retrofits. Using an event-study design applied to a panel survey of 10,000 households, we find evidence that the program had a substantial, yet short-lived, effect. Eligibility to the program increased investment by 20-22% on the extensive margin and 2-3% on the intensive one, thereby generating 3% electricity savings. The effects are however limited to the first two years, after which they turn non-significant. They are primarily driven by low-income homeowners, suggesting the program effectively alleviates credit constraints. These results are robust to a range of robustness checks, including placebo regressions and propensity score weighting. They lead to leverage estimates in the 1.3-1.7 range in the `successful' period and below 1 thereafter. Using additional banking data to investigate the post-2011 failure, we find suggestive evidence that banks exploited prospective borrowers’ incomplete information to sell them their own loan products in lieu of a ZIGL.