“The Political Economic Effect of Chernobyl on Nuclear Energy Investment”

This paper investigates the political-economic determinants of nuclear energy investment using the Chernobyl accident as a natural experiment. We document several facts. First, Chernobyl reduced worldwide growth in the number of nuclear power plants. Second, the reduction is driven by increased construction delays in democracies and results in the prolonged use of older and less safe plants. Third, the nuclear growth slowdown in democracies is more pronounced in the presence of large fossil fuel reserves. Finally, nuclear plant capacity reduces coal-fired power plants and air pollution. The results provide evidence that political capture by energy groups is an important driver of the reduction in nuclear energy investment in democracies, and this is likely to undermine efforts to increase nuclear energy safety and moderate climate change.