Study On Market Reaction Of Green Policies In The Background Of Carbon Emission Reduction

The issue of climate change is getting more and more attention from countries around the world.The main cause of climate change is that people has used fossil fuels in large quantities in the past century and has emitted a large amount of greenhouse gases such as carbon dioxide and methane.In order to mitigate global warming and solve climate change issues,the International Conference on climate change has been actively organized and issued relevant policies,requiring all countries to take the initiative to undertake carbon emission reduction tasks.China has always attached great importance to the capacity-building of climate change,China has actively participated in the climate change conference and formulated relevant green policies.This research is based on the recent ten years' global green policy.We want to know whether the release of green policy will cause the reaction of Chinese market.The events selected in this article include 19 global policies from 2005 to 2016 and 20 domestic policies from 2007 to 2016.We use the market model of event study to calculate cumulative abnormal returns,in order to analyze the market reaction caused by green policies,and test the significance level of market response results by t test.Through t test,we find that more than half of the global green policies will cause significant negative abnormal returns in the market,and the 19 global policies also cause a significant negative return on capital market as a whole;The market reaction results of domestic policies show that the proportion of policies that cause positive responses to domestic policies is 55%,which is 15% higher than that of negative reactions,but the 20 domestic policies are significantly negative on the whole;We divided into 19 industries according to Industry Standards Commission in 2012,further research on the market reaction of green policy in different industries,the results show that for the global and domestic policies,which can cause significant reaction in mostly industry manufacturing,electricity and other main pollution industry.In order to explore whether the important announcement issued by the company on the 5 day before or after the occurrence of the event has an impact on the cumulative abnormal returns,we conduct cross-sectional analysis,and the results show that the important announcement issued by the company is significantly positively correlated with the cumulative abnormal return.Further,in order to prove that the cumulative abnormal return is caused by the event itself,we retest the sample after excluding the announcement of the company,and the result is basically consistent with our previous research.This paper studies the response of capital market to green policy under the background of China's emerging market.On the one hand,our paper expands the research perspective of carbon accounting,enriches the research of environmental policy and the literature of carbon accounting;On the other hand,our paper is beneficial to the effective implementation of carbon emission reduction policies for enterprises,It can promote the enterprises to carry out carbon emission reduction work,invest new energy and realize the goal of national energy saving and emission reduction;In addition,our paper will help the country make more reasonable and effective green policies.