TY - BOOK ID - 137025509 TI - This Changes Everything: Climate Shocks and Sovereign Bonds AU - Cevik, Serhan. AU - Jalles, João Tovar. PY - 2020 SN - 1513547976 PB - Washington, D.C. : International Monetary Fund, DB - UniCat KW - United States KW - Banks and Banking KW - Investments: Bonds KW - Public Finance KW - Environmental Economics KW - 'Panel Data Models KW - Spatio-temporal Models' KW - Survey Methods KW - Prices, Business Fluctuations, and Cycles: General (includes Measurement and Data) KW - Interest Rates: Determination, Term Structure, and Effects KW - Open Economy Macroeconomics KW - International Financial Markets KW - National Budget, Deficit, and Debt: General KW - Climate KW - Natural Disasters and Their Management KW - Global Warming KW - General Financial Markets: General (includes Measurement and Data) KW - Debt KW - Debt Management KW - Sovereign Debt KW - Climate change KW - Investment & securities KW - Finance KW - Public finance & taxation KW - Yield curve KW - Sovereign bonds KW - Bond yields KW - Public debt KW - Environment KW - Financial services KW - Financial institutions KW - Climatic changes KW - Bonds KW - Interest rates KW - Debts, Public KW - Panel Data Models KW - Spatio-temporal Models UR - https://www.unicat.be/uniCat?func=search&query=sysid:137025509 AB - Climate change is already a systemic risk to the global economy. While there is a large body of literature documenting potential economic consequences, there is scarce research on the link between climate change and sovereign risk. This paper therefore investigates the impact of climate change vulnerability and resilience on sovereign bond yields and spreads in 98 advanced and developing countries over the period 1995–2017. We find that the vulnerability and resilience to climate change have a significant impact on the cost government borrowing, after controlling for conventional determinants of sovereign risk. That is, countries that are more resilient to climate change have lower bond yields and spreads relative to countries with greater vulnerability to risks associated with climate change. Furthermore, partitioning the sample into country groups reveals that the magnitude and statistical significance of these effects are much greater in developing countries with weaker capacity to adapt to and mitigate the consequences of climate change. ER -