Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments March 13, 2022 erstellt
Description:
This paper studies a novel channel through which climate risks affect households’ portfolio choices: a stringent climate change regulation elevates labor income risk for households employed by high-emission industries which in turn discourages households' financial risk-taking. Using staggered adoptions of climate change action plans across states, we find that climate change action plans lead to a reduction in the share of risky assets by 15.4% for households in high-emission industries. We also find a reduction in risky asset holdings after the stringent EPA regulation. These results are stronger with experiences of climate change-related disasters. Our study implies an unintended consequence of climate regulations for wealth inequality by discouraging low-wealth households' financial risk-taking