MNI BRIEF: Carney: Fiscal Multipliers Justify Green Investment

Former Bank of England and Bank of Canada Governor Mark Carney, now UK Finance Adviser for COP26, the UN Climate Change Conference, said that fiscal multipliers alone justified state investment in green energy infrastructure. Carney, speaking at a Money Macro and Finance event chaired by BOE Deputy Governor Dave Ramsden, did not link climate policy directly to monetary policy but he argued strongly that public sector spending on green energy would boost jobs and growth.

"From an energy infrastructure perspective much of this transition has bigger job multipliers, and GDP multipliers, than conventional infrastructure," he said, citing research showing multipliers of around 2.5 times for GDP while stating that post Covid, with mismatches between job vacancies and skills, that "active labour market policies are necessary as well."