Governmental subsidies, corporate environmental investments and firm performance: Evidence based on oil & petroleum industry

Dawei Xue, Jiayin Feng and Zhihong Zhu

Finance Research Letters, 2023, vol. 56, issue C

Abstract: This paper examines the impact of different types of government subsidies on the financial performance of oil & petroleum corporations. We find that environment-friendly government subsidies enhance the investments in environmental protection of oil & petroleum corporations, comparing with non-environment-friendly subsidies. Furthermore, preventive investments in environmental protection significantly mediate the effect of corporate subsidies on financial performance, whereas government investments in environmental protection have a masking effect. Overall, we provide policy implications for government support to balance the development of firms and environmental protection.

Keywords: Oil & petroleum corporations; Subsidies; Environmental protection; Financial performance (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:56:y:2023:i:c:s1544612323003914

DOI: 10.1016/j.frl.2023.104019

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