Abstract
This research empirically analyzes the psychological impact of smog pollution on investors. Results indicate that smog pollution has negative impact on investor sentiment which is weakened by the positive tone in media reporting. Empirical evidence for the impact of smog pollution on investor sentiment and the related moderating role of media tone is presented in this study.
Highlights
Edited by: Abdelkader Mohamed SghaierDerbali, University of Kairouan, TunisiaReviewed by: Yousra Trichilli, University of Sfax, Tunisia Ahmed K
This study proposes that smog pollution can change the expectations and judgments of investors by influencing the development of companies and investors’ perceptions
The regression results of Model (1) show that the coefficient of PM2.5 is -8.9972 10−3, which is significant at the 5% level and indicates a negative impact of smog pollution on investor sentiment
Summary
Reviewed by: Yousra Trichilli, University of Sfax, Tunisia Ahmed K. Some related studies found that air quality can change investor sentiment and behavior, affecting trade activities and the stock market (Li and Peng, 2016). Extant research on the relationships between air quality and investor sentiment is more focused on financial markets. It is lack of research focusing on the impact of smog pollution on investor sentiment at the level of individual share. This study uses panel data of China’s listed companies to test the psychological impact of smog pollution on investors, as well as analyzes the moderating effects of media tone in related news reporting
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