The aim of SMOOTH is to study the dynamic links between macro-financial systems and the transition to a low-carbon society, and to contribute to the design of policies directed at achieving a rapid and smooth decarbonisation.  

The project is composed of three main areas of work:

  • The study of how heterogeneous expectations, sentiments and cognitive biases affect the carbon intensity of physical and financial investments.
  • The analysis of the macroeconomic/financial drivers and implications of the low-carbon transitions.
  • The study of the governance and political economy implications of a low-carbon transition, with a focus on the role of central banks and financial regulators.

SMOOTH started in September 2020 and will last five years. It is conducted by an international interdisciplinary research team at the Department of Economics of the University of Bologna, in collaboration with the RFF-CMCC European Institute on Economics and the Environment, based in Milano.


Ongoing activities include: 

  • The development of a dynamic modelling framework with heterogeneous transition-related expectations.
  • The analysis of how transition-related shocks propagate via international production networks.
  • The study of the impact of financing constraints on clean technical change and the policies to support it.
  • The development of an analytical integrated assessment model to study optimal transition paths.
  • The expansion of socio-technical transition theory to include the financial regime, with a focus on central banks.
  • The analysis of climate-related central bank communication.


For job and collaboration opportunities with the SMOOTH project, visit our Jobs page.