A substantially revised version of Asset Diversification vs. Climate Action is now available at SSRN.
We have added several robustness checks and sensitivity analyses. In particular, we extend the analysis for learning by doing in renewables production and show that the green transition occurs more quickly than in the benchmark specification but the key insights on the interplay between diversification and abatement motives still hold. Besides, we have extended our analysis on asset pricing and discuss how climate policy affects returns on green and brown assets and show how our findings fit into the literature on the carbon premium.
