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https://doi.org/10.1016/j.jeem.2010.06.002

has been cited by the following article:

• TITLE: Carbon Emissions and Stock Returns: Evidence from the Chinese Pilot Emissions Trading Scheme

  AUTHORS: Miao Zhang, Russell B. Gregory-Allen

  KEYWORDS: Carbon Emissions Trading Schemes, Carbon Premium, CAPM, Fama French Three-Factor Model

  JOURNAL NAME: Theoretical Economics Letters, Vol.8 No.11, August 6, 2018

  ABSTRACT: In response to mounting evidence of climate change and the Kyoto Protocol, in 2011, the Chinese central government decided to build a nationwide carbon emissions scheme, beginning with seven pilot schemes launched in 2013. These pilot schemes were based on the similar European Emissions Trading Scheme. Oestreich and Tsiakas [1] examine the European scheme, finding when carbon emission allowances were granted free of charge, firms who received them (defined as “dirty” firms) outperformed the firms who did not (defined as “clean firms”), indicating that there is a significant “carbon premium.” This study follows the methodology of Oestreich and Tsiakas [1] with Chinese data from the largest of the pilot schemes, the Shenzhen Pilot Emissions Trading Scheme. We find no positive, significant carbon premium but do find weak evidence of a negative premium for a special group of “very dirty” firms.