How Policy Changes Affect Shareholder Wealth: The Case of the Fukushima Daiichi Nuclear Disaster
AbstractThis paper analyzes how policy changes affect shareholder wealth in the context of environmental regulation. We exploit the unique and unexpected German reaction to the Fukushima Daiichi nuclear disaster, which involved the immediate shutdown of almost half of Germany’s nuclear reactors while safety checks were carried out, and a three-month moratorium on extending the lives of others. Using the event study methodology, our findings indicate a wealth transfer from nuclear energy companies to renewable energies companies in Germany. We moreover find that the joint market capitalization of these firms has decreased, but the amount of this combined decrease is small. Substantial heterogeneity in the shareholder wealth effects across European countries can be linked to different nuclear energy policies. The shareholder wealth of nuclear and conventional energy companies in the United States has been unaffected.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5896.
Length: 34 pages
Date of creation: Aug 2011
Date of revision:
Publication status: published in: Applied Economics Letters, 2013, 20 (8), 799-803 [Details & Download]
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Other versions of this item:
- André Betzer & Markus Doumet & Ulf Rinne, 2013. "How policy changes affect shareholder wealth: the case of the Fukushima Dai-ichi nuclear disaster," Applied Economics Letters, Taylor & Francis Journals, vol. 20(8), pages 799-803, May.
- AndrÃ© Betzer & Markus Doumet & Ulf Rinne, 2011. "How Policy Changes Affect Shareholder Wealth: The Case of the Fukushima Daiichi Nuclear Disaster," Schumpeter Discussion Papers, UniversitÃ¤tsbibliothek Wuppertal, University Library sdp11011, UniversitÃ¤tsbibliothek Wuppertal, University Library.
- Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
- Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters
- G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-08-22 (All new papers)
- NEP-ENE-2011-08-22 (Energy Economics)
- NEP-ENV-2011-08-22 (Environmental Economics)
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