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The role of enterprises in the relationship between climate risk and regional governmental income

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  • Yu, Dahai
  • Tan, Yao

Abstract

Most domestic enterprises perceive overseas relocation as infeasible. By developing a damage ranking index to evaluate relative climate change risks across China's 31 provincial regions and using panel data from 2003 to 2019, this study reveals that enterprises exhibit complete mediation effects in the relationship between climate change risk and governmental income. Large enterprises and private enterprises exhibit the most and least sensitivities, respectively, to external influences. Furthermore, comparative heterogeneity tests suggest that, within the context of rapid regional development, only minor damage from climate disasters has occurred in China, implying that its domestic climate regulations are primarily motivated by a commitment to global climate mitigation responsibilities.

Suggested Citation

  • Yu, Dahai & Tan, Yao, 2025. "The role of enterprises in the relationship between climate risk and regional governmental income," Finance Research Letters, Elsevier, vol. 79(C).
    • Handle: RePEc:eee:finlet:v:79:y:2025:i:c:s154461232500515x
    DOI: 10.1016/j.frl.2025.107252
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    References listed on IDEAS

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