Carbon Emission Trading and Corporate Financing: Evidence from China

As an important tool to control CO2 emission, carbon emission trading (CET) has been highlighted in prior studies for its positive effects on firms. However, we are concerned about the role of CET corporate financing. Through a quasi-natural experiment from China’s pilot, regarded as start-up stage system, investigate manufacturing financing (i.e., debt and commercial credit financing). The results show that firms market have less Additionally, heterogeneity analysis, found (1) is negatively related when their constraints weak, whereas it only reduces long-term with strong constraints. (2) impact not significant located first-tier cities China, but other cities, influences firms’ contributes (3) plays negative high energy-consuming industries. This study enlightens government improve system increase support market.