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Green Credit Policies and the Devaluation of Pollution-Intensive Enterprises: A Quasi-Natural Experiment

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  • Weidong Huo

    (Division of Economics, Liaoning University, Shenyang 110036, China)

  • Bingwen Wang

    (School of Finance and Trade, Liaoning University, Shenyang 110036, China)

Abstract

We investigate the impact of green credit policies on pollution-intensive enterprises from a new perspective. Empirically, we utilize the issuance of China’s green credit policy in 2012 to construct a quasi-natural experiment. The results show that green credit policies can significantly reduce the market value of pollution-intensive enterprises. Furthermore, our analysis of profitability and R&D investment shows that the decline in market value is driven by real financial deterioration rather than short-term investor reactions. The results indicate that green credit policies can effectively suppress pollution-intensive enterprises. Additionally, the results also suggest that China’s stock market reasonably prices environmental risks.

Suggested Citation

  • Weidong Huo & Bingwen Wang, 2025. "Green Credit Policies and the Devaluation of Pollution-Intensive Enterprises: A Quasi-Natural Experiment," Sustainability, MDPI, vol. 17(5), pages 1-21, March.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:5:p:2262-:d:1605949
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