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Green credit policy, property rights and debt financing: Quasi-natural experimental evidence from China

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  • Liu, Xinghe
  • Wang, Enxian
  • Cai, Danting

Abstract

Our paper uses the promulgation of the "Green Credit Guidelines" policy in China as a quasi-natural experiment. Based on a difference-in-differences (DID) model, the results show that the debt financing capacity of heavily polluting enterprises has dropped significantly, and the negative net effect of debt financing is more pronounced in state-owned enterprises and enterprises in regions with weak financial ecosystems. The research results show that the green credit policy system plays a guiding role in the allocation of credit resources.

Suggested Citation

  • Liu, Xinghe & Wang, Enxian & Cai, Danting, 2019. "Green credit policy, property rights and debt financing: Quasi-natural experimental evidence from China," Finance Research Letters, Elsevier, vol. 29(C), pages 129-135.
    • Handle: RePEc:eee:finlet:v:29:y:2019:i:c:p:129-135
    DOI: 10.1016/j.frl.2019.03.014
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    References listed on IDEAS

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    1. Xinghe Liu & Enxian Wang & Danting Cai, 2018. "Environmental Regulation and Corporate Financing—Quasi-Natural Experiment Evidence from China," Sustainability, MDPI, vol. 10(11), pages 1-22, November.
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    More about this item

    Keywords

    Green credit policy; Property rights; Debt financing; Financial ecological environment; Heavily polluting enterprises;
    All these keywords.

    JEL classification:

    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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