The pricing of green bonds: Does social capital matter? Evidence from China

Hao Chen, Yijun Meng, Xueping Ning and Yuanbo Qi

Finance Research Letters, 2024, vol. 67, issue PA

Abstract: This paper examines the relation between the level of regional societal trust and the cost of green bonds. We conduct empirical estimation on 330 green bonds issued in China from 2016 to 2019, and find that a higher level of provincial societal trust can significantly reduce the spread premium of green bonds. Further investigation reveals that because generalized social capital can take the place of an individual's particular social capital, trust has a more pronounced effect on bond spread when the issuer's ultimate controller has a less extensive social network.

Keywords: Societal trust; Green bonds; Social network; Green development (search for similar items in EconPapers)
JEL-codes: F22 G34 G38 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:67:y:2024:i:pa:s1544612324007864

DOI: 10.1016/j.frl.2024.105756

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