ORCID ID
https://orcid.org/0000-0003-2766-3771
Date of Award
8-2025
Degree Type
Dissertation
Degree Name
Ph.D.
Degree Program
Financial Economics
Department
Economics and Finance
Major Professor
Neal Maroney
Second Advisor
Mohammad K Hassan
Third Advisor
Luca Pezzo
Fourth Advisor
Mosab Hammoudeh
Abstract
Externality disclosures have become a central focus of policymakers in Europe, through several initiatives including the Non-Financial Reporting Directive (NFRD) and the Corporate Sustainability Reporting Directive (CSRD). In this study, I investigate whether these policies improve carbon disclosures, and more critically, whether such directives are reflected in firms’ implied cost of capital. Given the non-missing at random nature of emission disclosures, I employ Heckman selection model and a two-stage least squares (2SLS) imputation strategy. The results reveal a carbon discount: large brown firms face a lower ICC relative to their green counterparts, suggesting that investors do not uniformly penalize carbon intensity. This study provides novel evidence on the conditional and asymmetric pricing of carbon risk, with implications in environmental policy and the progress towards net-zero commitments.
Recommended Citation
Hamoutan, Nezha, "Environmental Policy, Externalities, and the Carbon Risk Premium in Europe" (2025). University of New Orleans Theses and Dissertations. 3296.
https://scholarworks.uno.edu/td/3296
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Rights
The University of New Orleans and its agents retain the non-exclusive license to archive and make accessible this dissertation or thesis in whole or in part in all forms of media, now or hereafter known. The author retains all other ownership rights to the copyright of the thesis or dissertation.