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Is inhibition of financialization the sub-effect of the green credit policy? Evidence from China

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  • Jiang, Pengcheng
  • Jiang, Hongli
  • Wu, Jiahui

Abstract

This study investigates the impact of green credit policy on the financialization of heavily polluting firms by regarding the promulgation of the “Green Credit Guidelines” (GCGs) in China as a quasi-natural experiment. The results show that the green credit policy significantly inhibits the financialization of heavily polluting firms, and financing constraints play mediating roles between them. Furthermore, we find that the inhibitory effect of GCGs is more pronounced in small firms, the firms whose CEO with financial work experience, firms in regions with low financial development. Our results provide new insights into the value of the green credit policy.

Suggested Citation

  • Jiang, Pengcheng & Jiang, Hongli & Wu, Jiahui, 2022. "Is inhibition of financialization the sub-effect of the green credit policy? Evidence from China," Finance Research Letters, Elsevier, vol. 47(PB).
    • Handle: RePEc:eee:finlet:v:47:y:2022:i:pb:s1544612322000605
    DOI: 10.1016/j.frl.2022.102737
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    References listed on IDEAS

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    Cited by:

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    7. Yu Liu & Huiping Ding & Biao Sun, 2022. "Does Green Credit Policy Promote or Inhibit Firms’ Green Innovation in China? Moderating Effect of Environmental Information Disclosure," Sustainability, MDPI, vol. 15(1), pages 1-17, December.
    8. Gao, Yihong, 2022. "Green credit policy and trade credit: Evidence from a quasi-natural experiment," Finance Research Letters, Elsevier, vol. 50(C).
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    10. Li, Shibin & Wang, Qian, 2023. "Green finance policy and digital transformation of heavily polluting firms: Evidence from China," Finance Research Letters, Elsevier, vol. 55(PA).

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