Abstract

AbstractThis study explores the influence of air pollution on the corporate bond market in China. An air pollution premium is documented, whereby bonds issued in more polluted areas are associated with higher offering yields at issue in the primary market and higher yield spreads in the secondary market. The statistically and economically significant air pollution premium is robust to a battery of sensitivity checks. The air pollution premium is associated with rising investor attention to climate risk in financial markets.

Full Text
Published version (Free)

Talk to us

Join us for a 30 min session where you can share your feedback and ask us any queries you have

Schedule a call