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Grauwe, P. Green money without inflation. Vierteljahrshefte zur Wirtschaftsforschung, 88(2), 51-54.
Grauwe, Paul De "Green money without inflation" Vierteljahrshefte zur Wirtschaftsforschung 88.2, , 51-54.
Grauwe, Paul De: Green money without inflation, in: Vierteljahrshefte zur Wirtschaftsforschung, vol. 88, iss. 2, 51-54, [online]


Green money without inflation

Grauwe, Paul De

Vierteljahrshefte zur Wirtschaftsforschung, Vol. 88 (2019), Iss. 2 : pp. 51–54

16 Citations (CrossRef)

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Paul De Grauwe, London School of Economics,

Cited By

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Summary: The ECB has announced that when government and corporate bonds come to maturity in the context of its QE-program, new bonds will be bought in the market so as to keep the money stock (money base) unchanged. This creates a “window of opportunities” for the ECB. It could replace the old bonds with new “environmental bonds”, i. e. bonds that have been issued to finance environmental projects. In doing so, the ECB would not create new money. Given the existential nature of the degradation of the environment, including climate change, the priority should be to use the ECB’s money creation capacity towards the support of environmental investments. This can be done without creating inflation.

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