Does Environmental Policy Help Green Industry? Evidence from China’s Promotion of Municipal Solid Waste Sorting
Abstract
:1. Introduction
2. Literature Review
3. Materials and Methods
3.1. Methodology
3.1.1. Event Study
3.1.2. Difference-In-Differences (DID)-Based Propensity Score Matching (PSM)
3.2. Sample and Data Source
4. Results
4.1. Investor Reaction to Mandatory MSW Sorting
4.2. Mandatory MSW Sorting’s Effects on Firm Financing Constraints
5. Discussion
6. Conclusions
Author Contributions
Funding
Institutional Review Board Statement
Informed Consent Statement
Data Availability Statement
Conflicts of Interest
References
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Day | Average Abnormal Return (AAR) | Cumulative Average Abnormal Return (CAAR) | ||||
---|---|---|---|---|---|---|
MSW Sorting Firms | Other Green Firms | Polluting Firms | MSW Sorting Firms | Other green Firms | Polluting Firms | |
−10 | 0.0885 | 0.2693 | −0.1748 ** | 0.0885 | 0.2693 | −0.1748 ** |
−9 | −0.7557 *** | −0.7532 *** | −0.6322 *** | −0.6672 ** | −0.4839 | −0.807 *** |
−8 | −0.8481 *** | −0.5939 ** | −0.723 *** | −1.5153 *** | −1.0779 *** | −1.53 *** |
−7 | 1.7151 *** | 1.281 *** | 0.8352 *** | 0.1999 | 0.2031 | −0.6948 *** |
−6 | 0.1997 | −0.0482 | −0.1071 | 0.3996 | 0.1549 | −0.8019 *** |
−5 | −0.534 ** | −0.1671 | −0.4435 *** | −0.1344 | −0.0121 | −1.2455 *** |
−4 | 1.1841 *** | 1.4397 *** | 0.8806 *** | 1.0497 | 1.4276 * | −0.3648 |
−3 | −1.8446 *** | −2.0771 *** | −1.303 *** | −0.7949 | −0.6496 | −1.6678 *** |
−2 | 1.2585 *** | 0.9635 *** | 0.5991 *** | 0.4636 | 0.3139 | −1.0687 *** |
−1 | −2.5217 *** | −2.6202 *** | −1.8055 *** | −2.0581 ** | −2.3063 *** | −2.8742 *** |
0 | 0.1552 | −0.1798 | −0.2403 *** | −1.9029 * | −2.4861 *** | −3.1145 *** |
1 | −4.5748 *** | −4.177 *** | −3.3403 *** | −6.4777 *** | −6.6631 *** | −6.4548 *** |
2 | 0.4984 | 1.4288 *** | 0.8997 *** | −5.9793 *** | −5.2343 *** | −5.5551 *** |
3 | −3.0137 *** | −2.9428 *** | −2.6257 *** | −8.993 *** | −8.1771 *** | −8.1808 *** |
4 | 0.7138 ** | 0.3833 | 0.9061 *** | −8.2793 *** | −7.7938 *** | −7.2747 *** |
5 | 1.3256 *** | 0.9335 *** | 1.2766 *** | −6.9537 *** | −6.8603 *** | −5.9981 *** |
6 | 1.1089 *** | 1.2247 *** | 0.785 *** | −5.8447 *** | −5.6357 *** | −5.2131 *** |
7 | −0.225 | −0.0664 | −0.1826 *** | −6.0697 *** | −5.702 *** | −5.3957 *** |
8 | 1.0379 *** | 1.1546 *** | 1.1615 *** | −5.0318 *** | −4.5474 *** | −4.2342 *** |
9 | −0.2494 | −0.0377 | −0.2078 *** | −5.2812 *** | −4.5851 *** | −4.442 *** |
10 | -0.2412 | 0.0152 | 0.2364 *** | −5.5224 *** | −4.5699 *** | −4.2056 *** |
Variable | Unmatched | Mean | %Bias | %Reduct | Bias | | t-Test | ||
---|---|---|---|---|---|---|---|
Matched | Treated | Control | t | p > | t | | |||
size | U | 22.623 | 22.485 | 11.4 | 55.0 | 0.85 | 0.394 |
M | 22.623 | 22.684 | −5.1 | −2.29 | 0.771 | ||
ownership | U | 0.418 | 0.386 | 6.5 | −87.6 | 0.53 | 0.593 |
M | 0.418 | 0.358 | 12.1 | 0.71 | 0.482 | ||
asset tangibility | U | 32.638 | 43.092 | −47.2 | 93.6 | −3.85 | 0.000 |
M | 32.638 | 31.964 | 3.0 | 0.17 | 0.862 | ||
growth | U | 19.095 | 53.706 | −1.5 | 83.1 | −0.09 | 0.931 |
M | 19.095 | 24.941 | −0.3 | −0.34 | 0.737 | ||
current ratio | U | 1.664 | 2.414 | −8.1 | 99.3 | −0.47 | 0.636 |
M | 1.664 | 1.670 | −0.1 | −0.02 | 0.985 | ||
lev | U | 50.463 | 43.234 | 37.6 | 72.7 | 2.92 | 0.003 |
M | 50.463 | 52.435 | −10.3 | −0.59 | 0.559 | ||
instinv | U | 36.432 | 42.426 | −26.1 | 88.1 | −2.15 | 0.032 |
M | 36.432 | 35.717 | 3.1 | 0.19 | 0.849 | ||
ROA | U | 3.001 | 3.995 | −15.7 | 57.9 | −1.32 | 0.188 |
M | 3.001 | 3.420 | −6.6 | −0.33 | 0.742 | ||
ROE | U | 2.222 | 4.570 | −15.2 | 84.4 | −1.18 | 0.237 |
M | 2.222 | 1.856 | 2.4 | 0.09 | 0.926 | ||
cashflow | U | 0.007 | 0.008 | −1.4 | −673.7 | −0.10 | 0.923 |
M | 0.007 | −0.001 | 10.7 | 0.74 | 0.459 |
Variable | Model (1) DID | Model (2) PSM-DID | Model (3) Robustness Test | Model (4) Robustness Test |
---|---|---|---|---|
treated*period | 0.014 (0.23) | 0.015 (0.25) | −0.003 (−0.13) | 0.013 (0.29) |
period | −0.183 *** (−16.32) | −0.183 *** (−16.19) | −0.182 *** (−12.72) | −0.189 *** (−22.51) |
treated | 0.037 * (1.94) | 0.039 ** (2.04) | 0.031 *** (4.40) | 0.036 * (1.79) |
size | 1.216 *** (277.25) | 1.217 *** (274.07) | 1.216 *** (278.46) | 1.222 *** (278.44) |
ownership | −0.407 *** (−52.65) | −0.408 *** (−52.14) | −0.408 *** (−52.67) | −0.410 *** (−53.35) |
asset tangibility | −0.001 *** (−3.02) | −0.001 *** (−2.89) | −0.001 ** (−3.06) | −0.001 *** (−3.14) |
growth | 0.000 (0.50) | 0.000 (−1.52) | 0.000 (0.41) | 0.000 (0.41) |
current ratio | 0.000 (−0.45) | 0.008 *** (3.46) | 0.000 (−0.59) | 0.000 (−0.61) |
lev | −0.005 *** (−16.33) | −0.005 *** (−14.48) | −0.005 *** (−16.37) | −0.005 *** (-16.86) |
instinv | −0.002 *** (−9.56) | −0.001 *** (−8.74) | −0.002 *** (−9.71) | −0.002 *** (−9.62) |
ROA | −0.004 *** (−5.41) | −0.004 *** (−4.47) | −0.004 *** (−5.32) | −0.005 *** (−6.48) |
ROE | 0.000 (−0.20) | 0.001 (1.22) | 0.000 (−0.23) | 0.000 (0.49) |
cashflow | −0.067 (−1.64) | −0.065 (−1.55) | −0.067 (−1.62) | −0.081 *** (−1.99) |
Constant | −22.606 *** (−234.35) | −22.647 *** (−230.7) | −22.607 *** (−234.62) | −22.654 *** (−235.6) |
Number of Obs | 22440 | 22130 | 22440 | 22440 |
R-squared | 0.902 | 0.901 | 0.902 | 0.903 |
Prob > F | 0.000 | 0.000 | 0.000 | 0.000 |
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Chen, D.; Wang, Y.; Wen, Y.; Du, H.; Tan, X.; Shi, L.; Ma, Z. Does Environmental Policy Help Green Industry? Evidence from China’s Promotion of Municipal Solid Waste Sorting. Int. J. Environ. Res. Public Health 2021, 18, 2799. https://doi.org/10.3390/ijerph18062799
Chen D, Wang Y, Wen Y, Du H, Tan X, Shi L, Ma Z. Does Environmental Policy Help Green Industry? Evidence from China’s Promotion of Municipal Solid Waste Sorting. International Journal of Environmental Research and Public Health. 2021; 18(6):2799. https://doi.org/10.3390/ijerph18062799
Chicago/Turabian StyleChen, Di, Yue Wang, Yang Wen, Honglin Du, Xue Tan, Lei Shi, and Zhong Ma. 2021. "Does Environmental Policy Help Green Industry? Evidence from China’s Promotion of Municipal Solid Waste Sorting" International Journal of Environmental Research and Public Health 18, no. 6: 2799. https://doi.org/10.3390/ijerph18062799