Research

Work in Progress

Environmental Protection with Heterogeneous Agents: Can Financial Markets Outperform Traditional Policies?

Giada Durante

Work in Progress

Develops a general equilibrium model with heterogeneous climate preferences and beliefs to study optimal environmental policy. Shows that uniform carbon taxes and permits misprice environmental damages under heterogeneity, while a quality-indexed security linked to environmental outcomes can partially replicate planner-optimal wedges through market trade.

Biodiversity from Space: Satellite-Based Measures of Natural Capital Exposure

Giada Durante, S. Lakshmi Naaraayanan, Jean Pauphilet, and Kunal Sachdeva

Work in Progress

Provides a portable framework for studying biodiversity risk across asset classes and in global markets. Develops a firm-level measure of natural capital exposure by combining publicly-available satellite imagery with species observations using machine-learning predictions, and maps the resulting biodiversity estimates to the geocoded establishments of U.S. public firms.

Integrating Climate Concerns into Monetary Policy: Boost a Greener Financial System? Evidence from the European Corporate Bond Market

Giada Durante

Work in Progress

Studies whether central bank climate-related communication and policy design affect green asset prices. Using difference-in-differences around ECB announcements in 2021 and 2022, the project finds that green corporate bonds experienced significantly larger price increases relative to non-green bonds, suggesting that integrating climate considerations into monetary policy can influence capital allocation toward sustainable finance.

ECB Publications

Firms’ Access to Finance and the Business Cycle: Evidence from the SAFE

Giada Durante, Annalisa Ferrando, Asger Munch Grønlund, and Timo Reinelt

ECB Economic Bulletin, Issue 8/2022

Examines how financing gaps and firms’ expectations regarding bank loan availability correlate with monetary policy changes and macroeconomic outcomes across the euro area.

Substitution between Debt Security Issuance and Bank Loans: Evidence from the SAFE

Giada Durante, Annalisa Ferrando, Asger Munch Grønlund, and Timo Reinelt

ECB Economic Bulletin, Issue 1/2023

Examines whether firms shift from bond issuance to bank borrowing when corporate bond market conditions deteriorate, and whether this crowding effect worsens lending availability for small and medium enterprises.