Populism, Polarization and Green Investment
We use detailed, individual-level, panel data to relate growing political polarization to (i) changing beliefs about the pace of global warming and (ii) the propensity to make climate-friendly investment decisions. Individuals in our study were exogenously exposed to forest fires to varying degrees in the summer of 2018. While exposure increased the perceived pace of climate change on average, the response is attenuated in areas experiencing increases in right-wing populism, especially when local environmental media coverage was stronger. Changing beliefs also predict climate-friendly investment, but this is heavily mediated by the same political dynamics.
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