 Is carbon price uncertainty priced in the corporate bond yield spreads? Evidence from Chinese corporate bond marketsBin Li, Han Wang and Yanyi Ye International Review of Financial Analysis, 2025, vol. 107, issue C Abstract: This study aims to explore the impact of carbon price uncertainty on corporate bond yield spreads using an extensive data set of Chinese corporate bonds issued by publicly listed firms between May 2014 and December 2022. The study finds that the carbon price uncertainty raises the corporate bond yield spreads. Two economic channels are identified through which carbon price uncertainty affects corporate bond yield spreads: credit risk and bond liquidity. The study's results are robust to alternative measures of the carbon price uncertainty, yield spreads, fixed effects, and alternative samples. The impact of carbon price uncertainty on bond yield spreads is more pronounced for firms with higher corporate energy consumption, lower corporate information transparency, and the release of carbon trading regulatory policy. This study suggests that carbon price uncertainty is one of the important determinants of corporate bond pricing. Keywords: Carbon price uncertainty; Corporate bond yield spreads; Credit risk; Bond liquidity (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:107:y:2025:i:c:s1057521925007057 DOI: 10.1016/j.irfa.2025.104618 Access Statistics for this article International Review of Financial Analysis is currently edited by B.M. Lucey More articles in International Review of Financial Analysis from Elsevier |
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