| Using panel data of 23 countries from 2005 to 2014, this thesis looks at the effects of public interventions on private investment in climate mitigation and adaptation activities in developing countries. An econometric analysis shows that the provision of international disbursements to developing countries has a negative effect on private climate finance. In contrast, domestic regulatory policies have significant and positive effects on private investment volume, while fiscal policies have significant but negative effects on private investment volume. The results indicate that in terms of international disbursements and public fiscal policies, the crowding-out effect outweighs the signaling effect in climate finance. However, regulatory policies are not associated with any financial incentives and therefore, do not crowd out private investment. The paper also points out data limitations in climate finance and directions for future research. |
