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Green bond issuance premium effect and investor incentive effect

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  • Hao, Yinhui
  • Zhou, Yan

Abstract

This study examines a sample of 7862 green bonds and conventional bonds issued in China from January 2017 to December 2023, employing an OLS model for empirical analysis. The findings reveal that green bonds command a notable premium in the primary market, featuring significantly lower credit spreads compared to ordinary bonds, thereby offering enterprises a more economically efficient means of raising capital. Specifically, green financial bonds boast the narrowest credit spreads, indicating their superior market attractiveness. While green corporate bonds also display lower credit spreads than their conventional counterparts, their premium effect is comparatively less pronounced.

Suggested Citation

  • Hao, Yinhui & Zhou, Yan, 2025. "Green bond issuance premium effect and investor incentive effect," Finance Research Letters, Elsevier, vol. 85(PC).
    • Handle: RePEc:eee:finlet:v:85:y:2025:i:pc:s1544612325013005
    DOI: 10.1016/j.frl.2025.108042
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    References listed on IDEAS

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