Does the EU ETS bite? : the impact of allowance over-allocation on share prices
| dc.contributor.author | JONG, Thijs | |
| dc.contributor.author | COUWENBERG, Oscar | |
| dc.contributor.author | WOERDMAN, Edwin | |
| dc.date.accessioned | 2013-07-10T13:30:25Z | |
| dc.date.available | 2013-07-10T13:30:25Z | |
| dc.date.issued | 2013 | |
| dc.description.abstract | The aim of this paper is to examine whether shareholders consider the EU Emissions Trading Scheme (EU ETS) as value-relevant for the participating firms. An analysis is conducted of the share prices changes as caused by the first publication of compliance data in April, 2006, which disclosed an over-allocation of emission allowances. Through an event study, it is shown that share prices actually increased as a result of the allowance price drop when firms have a lower carbon-intensity of production and larger allowance holdings. There was no significant value impact from firms’ allowance trade activity or from the pass-through of carbon-related production costs (carbon leakage). The conclusion is that the EU ETS does ‘bite’. The main impact on the share prices of firms arises from their carbon-intensity of production. The EU ETS is thus valued as a restriction on pollution. | en |
| dc.format.mimetype | application/pdf | |
| dc.identifier.issn | 1028-3625 | |
| dc.identifier.uri | https://hdl.handle.net/1814/27605 | |
| dc.language.iso | en | en |
| dc.relation.ispartofseries | EUI RSCAS | en |
| dc.relation.ispartofseries | 2013/54 | en |
| dc.relation.ispartofseries | Climate Policy Research Unit | en |
| dc.relation.ispartofseries | [Florence School of Regulation] | en |
| dc.relation.ispartofseries | [Climate] | en |
| dc.rights | info:eu-repo/semantics/openAccess | en |
| dc.subject | Climate change regulation | en |
| dc.subject | Emissions trading | en |
| dc.subject | EU ETS | en |
| dc.subject | Event study | en |
| dc.subject | Share prices | en |
| dc.title | Does the EU ETS bite? : the impact of allowance over-allocation on share prices | en |
| dc.type | Working Paper | en |
| dspace.entity.type | Publication | |
| eui.subscribe.skip | true |
