Dynamics of carbon risk, cost of debt and leverage adjustments
研究了2006-2020年间碳风险如何影响企业杠杆调整速度，发现碳风险与调整速度正相关，且低借贷成本企业调整更快，交易成本和执行成本也有显著影响。
We evaluate the effects of carbon risk on the speed at which corporations adjust their leverage for the period 2006–2020. Primarily we address the question: Does national carbon risk impact firm-level speed of adjustment (SOA)? To address the main question, our study further classifies the companies in the sample based on borrowing costs and carbon risk. By doing so, we report on how borrowing costs may influence the company's conduct. Our research focuses on the energy sector, which is an important sector for emitting carbon. Our study uses physical climate risk changes as a proxy for carbon risk, and the second proxy for carbon risk is obtained by scaling the country's carbon emissions to the company level. We find that the carbon risk is positively related to the speed of adjustment; specifically, the firms with low cost of borrowing show a faster speed of adjustment toward the target than those whose cost of borrowing is higher. However, businesses with high (low) expenses and high carbon risk do not see a reason to change their leverage. In addition, we also examine the interaction effects of earnings yield, transaction contract cost, enforcement cost on carbon risk, and the speed of leverage adjustment. Our results confirm that the effects of transaction contract costs and enforcement costs are significant. The post-Paris Agreement period reveals a strong positive relationship between carbon risk and leverage SOA.