Intermediary Capital and Financing Sustainable Investment DOI
Tak-Yuen Wong,

Jin Yu

SSRN Electronic Journal, Journal Year: 2023, Volume and Issue: unknown

Published: Jan. 1, 2023

We develop an equilibrium financing model that addresses agency frictions in sustainable investment, featuring socially responsible investors as intermediaries. Actively engaging with firms, these provide a funding advantage to green enterprises. Our findings reveal sustainability-linked debt emerges optimal security design, incentivizing both entrepreneurs and social investors. The return on capital, determined by incentive costs financial constraints associated investments, rises investor preferences through competition. Consequently, when prioritize societal well-being, heightened competition may lead the crowding out of investments. discuss real-world implications our emphasize need for welfare-improving regulatory measures alleviate market

Language: Английский

Consumer Preferences and Green Transition DOI

Florian Perusset

Published: Jan. 1, 2025

This paper investigates the effects of consumer preferences on green transition. I develop a real options model where firm, initially endowed with brown technology, faces stochastic consumers' for goods. Preferences goods are observable and governed by diffusion process whose drift is unknown to firm. Surprisingly, incomplete information does not necessarily delay transition relative complete benchmark. also use my investigate effectiveness different regulatory tools My findings reveal that regulations promoting investment such as subsidies or tax credits seem more promising they translate into high level carbon tax. Furthermore, generate set novel predictions regarding role consumers in tools.

Language: Английский

Citations

0
Sustainable Investing and Market Governance DOI
Jan Starmans, Deeksha Gupta, Alvin Chen

et al.

SSRN Electronic Journal, Journal Year: 2024, Volume and Issue: unknown

Published: Jan. 1, 2024

Language: Английский

Citations

1
Timing Matters: Dynamic Green Transition and Green Disclosure DOI
Deeksha Gupta, Jan Starmans

SSRN Electronic Journal, Journal Year: 2023, Volume and Issue: unknown

Published: Jan. 1, 2023

This paper studies the optimal design of green disclosure requirements to support firms' transition greener technologies. In a dynamic model with socially responsible investors, we as multi-step process. Our analysis establishes an important link between and underlying characteristics technologies driving transition. We show that government-mandated "greenwashing" which entails deliberately obscuring actual greenness, can create mis-valuation subsidies help overcome early bottlenecks. Dynamic become more stringent over time further incentivize Stricter in future enhance effectiveness lax periods vice versa. results be applied recent initiatives establish mandatory requirements.

Language: Английский

Citations

3
Intermediary Capital and Financing Sustainable Investment DOI
Tak-Yuen Wong,

Jin Yu

SSRN Electronic Journal, Journal Year: 2023, Volume and Issue: unknown

Published: Jan. 1, 2023

We develop an equilibrium financing model that addresses agency frictions in sustainable investment, featuring socially responsible investors as intermediaries. Actively engaging with firms, these provide a funding advantage to green enterprises. Our findings reveal sustainability-linked debt emerges optimal security design, incentivizing both entrepreneurs and social investors. The return on capital, determined by incentive costs financial constraints associated investments, rises investor preferences through competition. Consequently, when prioritize societal well-being, heightened competition may lead the crowding out of investments. discuss real-world implications our emphasize need for welfare-improving regulatory measures alleviate market

Language: Английский

Citations

1