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Market competition, environmental governance subsidies, and environmental penalty risks

Author

Listed:
  • Jiao, Yang
  • Tang, Hairong
  • Tu, Da
  • Liu, Hongli

Abstract

This study analyzes data from listed companies (2010–2022) to examine how market competition, environmental governance subsidies, and environmental penalty risk are interrelated. The empirical results show that market competition increases penalty risk, while subsidies mitigates them. Environmental governance subsidies moderate the relationship between market competition and corporate environmental penalty risk, showing heterogeneity in their effect on heavily polluting and nonheavily polluting enterprises. Furthermore, the impact of competition has a size threshold effect.

Suggested Citation

  • Jiao, Yang & Tang, Hairong & Tu, Da & Liu, Hongli, 2025. "Market competition, environmental governance subsidies, and environmental penalty risks," Finance Research Letters, Elsevier, vol. 79(C).
    • Handle: RePEc:eee:finlet:v:79:y:2025:i:c:s1544612325004878
    DOI: 10.1016/j.frl.2025.107224
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    References listed on IDEAS

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    2. He, Qiong & Geng, Yunjiang & Yu, Kexiu & Chen, Peng, 2025. "How does multinational enterprises’ digital transformation affect ESG performance? Empirical evidence based on Chinese A-share multinationals," Finance Research Letters, Elsevier, vol. 86(PG).

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