_ agreement. pdf available 10 unfccc. int / paris _ agreement / items / 9485. php 11 spencer, t., pierfederici, r. ( 2015 ), beyond the numbers : understanding the transformation induced by indcs, studies n°05 / 2015, iddri – miles project consortium, available at : www. iddri. org / publications / beyond - thenumbers - understanding - the - transformation - induced - by - indcs 12 “ … financial disclosure is essential to a market - based solution to climate change. a properly functioning market will price in the risks associated with climate change and reward firms that mitigate them. as its impact becomes more commonplace and public policy responses more active, climate change has become a material risk that isn ’ t properly disclosed. ” in carney, m., bloomberg, m., ( 2016 ), how to make a profit from defeating climate change, the guardian, 14 / 12 / 2016, available a t www. theguardian. com / commentisfree / 2016 / dec / 14 / bloomberg - carney - profit - from - climate - change - rightinformation - investors - deliver - solutions 13 expressed as gdp loss relative to base year gdp, at constant prices of 2008 3 / 4 bis central bankers'speeches 14 ccisc ( 2011 ), the environmental, economic and social impacts of climate change in greece, bank of greece, p. 454 available at www. bankofgreece. gr / bogekdoseis / climatechange _ fullreport _ bm. pdf 15 at constant prices of 2008, over the period till 2100 16 total cumulative cost through 2100, at constant prices of 2008 17 the vulnerability assessment is presented on the ccisc ( 2015 ), national climate change adaptation strategy ( nccas ), bank of greece, pp. 9 - 13 at www. bankofgreece. gr / bogdocumenten / national _ adaptation _ strategy _ excerpts. pdf 4 / 4 available bis central bankers'speeches

economists suggests that abolishing the preferential tax treatment of debt would raise average unweighted bank equity by 2. 2 to 4. 2 percentage points – implying no less than a doubling of the leverage ratio. even though the authors caution that the effect is likely to be lower for the biggest banks, these numbers are sizeable by any measure, especially considering that the proposed basel iii leverage ratio is 3 %. doing away with the preferential tax treatment of debt could therefore provide a major boost to financial stability. 3. 2 improved risk - sharing but in europe, in particular, the benefits of stronger equity markets extend even further. it might be the single most important step we can take towards bringing europe closer to an optimal currency area. economists like robert mundell and peter kenen have highlighted the importance of effective risk - sharing arrangements for the functioning of a monetary union. in public debates the most frequent ( and most contested ) proposal is to strengthen fiscal risk - sharing arrangements. but this debate runs the risk of missing the bigger picture. in the united states, for example, studies 9 show that fiscal policy cushions only 10 % to 20 % of economic shocks, so that a local income shock does not translate into a drop in consumption to the same extent. integrated capital markets play a far larger role – especially integrated equity markets, which smooth out around 40 % of the cyclical fluctuations among the us federal states. another share of around 25 % is cushioned via the credit markets. altogether, around 80 % of a given de mooij, ruud a. and keen, m. and orihara, m., taxation, bank leverage, and financial crises ( february 2013 ). imf working paper no. 13 / 48. asdrubali p ; sørensen, b. e. ; yosha, o. ( 1996 ), “ channels of interstate risk sharing : us 1963 – 1990 ”, quarterly journal of economics, 111 ( 4 ), pp. 1081 – 1110. bis central bankers ’ speeches economic shock in the us is absorbed before it can affect consumption. studies for canada yield similar results. 10 in europe, the picture looks different. here, it is mainly credit markets that cushion economic shocks – and they are not very effective in doing so. altogether, only around 40 % of a given shock is absorbed before it can affect consumption. 11 increasing the share of capital markets and integrating them across borders would therefore help improve risk sharing in