IDEAS home Printed from https://ideas.repec.org/a/eee/eneeco/v142y2025ics0140988324008739.html
   My bibliography  Save this article

The impact of pilot carbon market on firms' performance in China

Author

Listed:
  • Luan, Limin
  • Liu, Pengfei
  • Mei, Yingdan

Abstract

The pilot carbon market is a vital policy tool in China's pursuit of its carbon peak and neutrality goals. Different trading mechanisms within these pilot markets create varying economic incentives in carbon trading, leading to differentiated impacts on corporate financial performance. This study analyzes the effects of carbon market trading mechanisms on firm performance by examining trading regulations in pilot carbon markets. Our findings reveal that regulated enterprises exhibit significantly better average economic performance than unregulated enterprises following the implementation of carbon market pilots. We also identify that total volume determination, initial quota allocation mechanisms, and quota offset mechanisms significantly influence corporate performance. Specifically, carbon emissions trading enhances enterprise economic performance more effectively when pilot carbon markets adopt predetermined total allowances, conduct allowance auctions, or allow for a higher proportion of allowance offsets.

Suggested Citation

  • Luan, Limin & Liu, Pengfei & Mei, Yingdan, 2025. "The impact of pilot carbon market on firms' performance in China," Energy Economics, Elsevier, vol. 142(C).
  • Handle: RePEc:eee:eneeco:v:142:y:2025:i:c:s0140988324008739
    DOI: 10.1016/j.eneco.2024.108164
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0140988324008739
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.eneco.2024.108164?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Emission trading; Firm performance; Environmental regulation;
    All these keywords.

    JEL classification:

    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:eneeco:v:142:y:2025:i:c:s0140988324008739. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eneco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.