Are European Renewable Energy Equities Experiencing an Asset Price Bubble, and When Should Monetary Policy Respond? An empirical study of European equity markets.
Master thesis
Submitted version
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https://hdl.handle.net/11250/2823559Utgivelsesdato
2021Metadata
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The purpose of this thesis is to identify whether European renewable energy equities are
experiencing an asset price bubble, and when monetary policy should respond. Dillian (2020)
speculated in the possibility of a stock market bubble in ESG investing, whereas Wimmer
(2016) suggested that a bubble could potentially be evolving within renewable energy. To
answer the research question, we examine and compare the pricing of renewable and
conventional energy companies in five European countries, as well as benching both groups
against the overall markets. We are not able to conclude certainly that European renewable
energy equities are currently experiencing an asset price bubble. However, we are also not
able to conclude that it is not. We suggest that monetary policy should respond to an eventual
future asset price bubble within the renewable energy sector ex-post.