gradual resolution of uncertainty lowers them. For temperature-dependent economic damage tipping points, carbon prices are … the risk-adjusted interest rate. Adding damages leads to a higher carbon price that grows more slowly. But as temperature …

We propose a proxy for a climate risk factor, the pollutive-minus-clean (PMC) portfolio, which captures differences in … obtain estimates of asset-level climate risk exposure: 'carbon beta'. Validation of carbon betas confirms that variation in … climate risk exposures aligns with our prior expectations. Our measure has desirable properties regarding availability …

price, the equilibrium risk-free rate, and risk premia. Climate disasters, which are more likely to occur sooner as … temperature rises, significantly increase risk premia. …