LAUSR

Most countries struggle to implement CO2 reducing policies. Implementation is politically difficult since it typically forces politicians to trade-off different concerns. The literature on how parties and members of parliament (MPs) handle these trade-offs is sparse. We use structural topic models to study how MPs in an oil dependent environment responded to a shock in the oil price that created spatially concentrated costs of climate policies. We leverage the rapid oil price drop between parliamentary sessions and MPs’ constituency adherence in a difference-in-differences framework to identify if MPs respond differently to variation in the salience of tradeoffs. We find that MPs facing high political costs of climate policies tried to avoid environmental topics, while less affected MPs talked more about investments in green energy when the oil price declined. Our results suggest that the oil price bust created a ‘window of opportunity’ for advocates of the ‘ green shift’.