The Inertia of private capital : the hidden brake on ecological transition

This thesis examines why European household savings remain largely disconnected from the financing needs of the ecological transition, despite strong regulatory efforts and widespread pro-environmental preferences. While the European Union has placed the mobilization of private capital at the core of its Green Deal strategy, a significant share of household wealth remains concentrated in safe and liquid assets, creating a persistent green investment gap. The central argument of this study is that green investment faces stronger barriers than conventional financial investment, due to the interaction between household-level behavioral constraints and the institutional architecture of sustainable finance. Drawing on behavioral finance, information economics, and agency theory, the thesis identifies two reinforcing mechanisms. First, household investment decisions are governed by a “return-first” filter based on expected returns, liquidity, and investment horizon. Green assets, perceived as less liquid, more volatile, or offering lower net returns, amplify existing behavioral biases such as loss aversion, ambiguity aversion, and myopic evaluation. Second, the complexity of sustainability-related information, combined with mistrust in financial intermediation and risks of greenwashing, weakens the translation of climate-oriented intentions into actual ownership of green financial securities