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Foreign investor and industrial pollution: Evidence from sulfur dioxide emission

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  • Chen, Wenchuan
  • Xiang, Yuhan
  • Liu, Jin
  • Zhu, Yilin

Abstract

This paper investigates the effect of foreign investors on industrial pollution. We find that shareholdings of foreign institutional investors reduce firms’ SO2 emissions. The impact is significant only for foreign investors with frequent trades, supporting the channel of voting by foot. Further, we find that the effect of foreign investors is more pronounced in non-state-owned firms, firms with lower shares of domestic institutional investors, and firms followed by fewer analysts. We adopt the 2SLS regression with instrumental variable, different fixed effects structures, and different measurements of key variables, and find our results robust.

Suggested Citation

  • Chen, Wenchuan & Xiang, Yuhan & Liu, Jin & Zhu, Yilin, 2022. "Foreign investor and industrial pollution: Evidence from sulfur dioxide emission," Finance Research Letters, Elsevier, vol. 50(C).
    • Handle: RePEc:eee:finlet:v:50:y:2022:i:c:s1544612322004676
    DOI: 10.1016/j.frl.2022.103279
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    References listed on IDEAS

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    Cited by:

    1. Qingwei Shi & Yupeng Hu & Tiecheng Yan, 2023. "A Study on the Effect of Innovation-Driven Policies on Industrial Pollution Reduction: Evidence from 276 Cities in China," Sustainability, MDPI, vol. 15(12), pages 1-18, June.

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    Keywords

    Foreign investors; SO2 emissions; Voting by foot;
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