Greenium in the Chinese corporate bond market

Xiaolu Hu, Angel Zhong and Youdan Cao

Emerging Markets Review, 2022, vol. 53, issue C

Abstract: This paper explores the pricing implications of green bonds in the Chinese corporate bond market. We document a large greenium in the Chinese green bond market, whereby green bonds are issued at lower offering yield spreads in the primary market and traded at lower yields in the secondary market. The magnitude of the Chinese greenium is substantially greater than other international green bond markets. Exploring the underlying mechanisms, we document convincing evidence that mitigation of information asymmetry and exposure to salient environmental stimuli such as air pollution are plausible explanations of the greenium.

Keywords: Climate finance, green bonds; Corporate bond market; Chinese economy (search for similar items in EconPapers)
JEL-codes: G12 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ememar:v:53:y:2022:i:c:s1566014122000632

DOI: 10.1016/j.ememar.2022.100946

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