Energy Economics and Finance Seminar
Event Summary
The seminar series in Energy Economics & Finance (EEF) is jointly organized by Wharton’s Business Economics and Public Policy Department, the Kleinman Center for Energy Policy, and Wharton’s Business, Climate and Environment Lab. The scope of the seminar includes regulation and policy papers. The scope of the seminar also includes environmental and transportation issues, as long as there is a connection with energy. Sessions are biweekly on Mondays from 3:30 p.m. – 4:30 p.m.
Snacks, beer, and wine will be served after the seminar!
For Fall 2024, the seminar will be held in-person in the Kleinman Center Classroom (Fisher Fine Arts Building Room 306).
Find and add a Google Calendar version of the schedule on the BEPP seminar page.
To sign up for the seminar, please send your name, email, and affiliation to Dhivya Kaushik: dhivya@wharton.upenn.edu
Pari Sastry
Assistant Professor of Finance, Columbia UniversityProfessor Parinitha (Pari) Sastry is an assistant professor of finance at Columbia Business School. Her research focuses on climate change, financial intermediation, and real-estate markets.
Talk Title: When Insurers Exit: Climate Losses, Fragile Insurers, and Mortgage Markets
Abstract: Despite growing climate losses, Americans are increasingly moving to high-risk areas. This paper examines how mispricing of climate risk in mortgages and homeowners insurance distorts household location choices. We use novel data on both mortgages and insurance to analyze these dynamics in Florida from 2009-2018. We begin by documenting a breakdown in the quality of insurance provision, with new under-capitalized and under-diversified insurers dominating insurance markets. These insurers have high rates of insolvency, which elevate mortgage defaults after natural disasters. We argue that the government-sponsored enterprises (GSEs) do not sufficiently screen property insurers, leading to a mispricing of insurer counterparty risk. This mispricing creates an implicit transfer with large taxpayer exposures and results in a misallocation of credit towards high-risk areas. Our estimates suggest that, every year, there are over 8,000 excess loans and close to \$2 billion in excess origination in high risk areas of Florida.
Fall Seminar Dates:
- 9/9: Imelda, Geneva Graduate Institute
- 9/16: Pari Sastry, Columbia University
- 9/30: Sandra Schafhautle, University of Pennsylvania
- 10/14: Seth Blumsack, Penn State
- 10/28: Lucy Qiu, University of Maryland
- 12/2: Karen Palmer, Resources for the Future
