EconPapers    
Economics at your fingertips  
 

Carbon emissions and credit ratings

Md Safiullah, Md Nurul Kabir and Mohammad Dulal Miah

Energy Economics, 2021, vol. 100, issue C

Abstract: We examine the impact of firm-level carbon emissions on credit ratings, drawing on a sample of 3116 firm-year observations over the period 2004–2018 in the context of U.S. We find a negative, economically meaningful impact of carbon emissions on credit ratings. This finding remains robust when we employ the instrumental variable approach, difference-in-differences approach, and propensity score matching estimates to address potential endogeneity concerns. Our channel analysis reveals that firms that emit high carbon face higher cash flow uncertainty, which in turn, results in lower credit ratings.

Keywords: Carbon emissions; Credit ratings; Climate change; Cashflow uncertainty (search for similar items in EconPapers)
JEL-codes: G14 G35 M14 Q51 (search for similar items in EconPapers)
Date: 2021
References: Add references at CitEc
Citations: View citations in EconPapers (27)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S014098832100236X
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:100:y:2021:i:c:s014098832100236x

DOI: 10.1016/j.eneco.2021.105330

Access Statistics for this article

Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant

More articles in Energy Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu (repec@elsevier.com).

 
Page updated 2024-12-28
Handle: RePEc:eee:eneeco:v:100:y:2021:i:c:s014098832100236x