Climate change and financial systemic risk: Evidence from US banks and insurers

Chiodo, Domenico; Gianfrancesco, Igor; Vioto, Davide

doi:10.1016/j.jfs.2023.101132

Cited by 28 publications

(1 citation statement)

References 36 publications

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“…Climate change itself can influence financial stability (Wang and Song, 2020;Pagnottoni et al, 2022), with the core mechanism being "uncertainty-mispricing-financial instability" (Yin, 2022). Extreme climate events can exacerbate systemic risks in the financial system (Gao et al, 2022a;Curcio et al, 2023;Ma and Song, 2023;Mao et al, 2023). These risks can generally be categorized into physical, liability, and transition risks, each with different transmission mechanisms (Carney, 2015).…”

Section: Reviewed Bymentioning

confidence: 99%

Has climate change promoted the high-quality development of financial enterprises? Evidence from China

Lyu,

Xiao

2024

Front. Environ. Sci.

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Climate change has become a critical global issue and challenge, with significant implications for financial enterprises as an integral part of economic activities. A thorough analysis of the impact of climate change on the high-quality development of financial enterprises is of great importance for financial sustainability. This paper first conducts an in-depth mathematical analysis of the intrinsic mechanisms through which climate change affects the high-quality development of financial enterprises by establishing a game theory model. Secondly, using data from listed companies for the years 2000–2020, an econometric model is constructed to empirically examine the relationship between climate change and the high-quality development of financial enterprises. The research findings demonstrate that climate change significantly inhibits the high-quality development of financial enterprises, as evidenced by robust results obtained through various methods such as data truncation, variable substitution, and changes in sample periods. Furthermore, this study addresses the endogeneity of the regression model using propensity score matching (PSM), instrumental variable methods, and system generalized method of moments (GMM). Additionally, climate change impacts the high-quality development of financial enterprises through technological innovation. Given the backdrop of climate change, understanding the relationship and logic between climate change and the high-quality development of financial enterprises and discerning the channels and mechanisms through which climate change affects their development are crucial. This research provides a new perspective and expands the research frontier on the high-quality development of financial enterprises, enriching the theoretical foundations in this field.

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Section: Reviewed Bymentioning

confidence: 99%