London School of Economics Grantham Research Institue on Climate Change and the Environment

Research

CETEx conducts research, analysis and policy development across two intersecting policy areas – monetary and financial markets and fiscal and economic policy – and a set of foundational topics.

CETEx’s research is designed to support the systems change required within individual jurisdictions, to be carried out by actors including domestic regulators, central banks, governments and state-owned banks, and within international institutions such as standard-setters and multilateral development banks, to accelerate the global economic transition to net zero.

CETEx is primarily a European centre with a major focus on the EU, UK and other European states. However, we also consider international best practice in financial policy on environmental degradation and the transition, and the key role of emerging market and developing economies (EMDEs) in renewable energy and technology supply chains.

Introducing our primary work programmes
  • Monetary and financial markets: covers central banking and financial supervision, focusing on the monetary, prudential and ‘developmental’ policy implications of environmental degradation and climate change and the transition to a sustainable and resilient economy.
  • Fiscal and economic policy: covers the role of fiscal and domestic economic policy as a central mechanism for funding the transition to low-carbon and resilient economies, along with international capital flows, multilateral development banks, policies and regulation.
  • Foundational topics: covers the foundational research and policy challenges that underpin the two focus areas above, including macroeconomic dimensions relating to growth, inflation and employment dynamics, transition pathway questions, and the political economy dimensions of the transition. Importantly, it includes factors beyond climate, including land and ocean-related environmental factors.
  • Nature: Focuses on the economic and financial implications of nature degradation—including biodiversity loss, soil and water degradation, and ocean decline. It builds the evidence base to demonstrate the relevance of ecosystem loss for the economy and financial system. It examines how nature-related considerations can be integrated into core policy frameworks, particularly, how monetary, prudential, fiscal, and trade-related policies can be adapted to manage associated risks, address key drivers, and support efforts to halt and reverse nature degradation.