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How does the new energy demonstration city pilot affect corporate green M&A: Evidence of A-share listed companies in China

Author

Listed:
  • Li, Zihao
  • Tang, Xuechun
  • Xu, Zihan
  • Mi, Feng

Abstract

Utilizing data of Chinese A-share listed companies from 2004 to 2023, this study examines the impact of the policy of new energy demonstration cities on corporate mergers and acquisitions by difference-in-differences model. The empirical results show that the policy significantly promotes green M&A. Heterogeneity analysis indicates that policy effects vary due to the environmental performance, the belonging regions, and the nature of the enterprises. Then, mechanism analysis proves that this policy promotes green M&A by facilitating green innovation, easing financing and reducing information asymmetry. Finally, it is revealed the negative moderating effect of corporate digital transformation on the impact of pilot policy on corporate green M&A. This study provides new insights into the impact path of new energy demonstration city policies on corporate green M&A.

Suggested Citation

  • Li, Zihao & Tang, Xuechun & Xu, Zihan & Mi, Feng, 2025. "How does the new energy demonstration city pilot affect corporate green M&A: Evidence of A-share listed companies in China," Finance Research Letters, Elsevier, vol. 85(PB).
    • Handle: RePEc:eee:finlet:v:85:y:2025:i:pb:s1544612325011675
    DOI: 10.1016/j.frl.2025.107909
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models

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