The wealth effects of the announcement of the Australian carbon pricing scheme

Han, Jianlei; Linnenluecke, Martina K.; Pan, Zheyao; Smith, Tom W.

doi:10.1016/j.pacfin.2018.12.006

Cited by 19 publications

(5 citation statements)

References 33 publications

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“…Their approach shows that share price information alone understates the true value created in corporate acquisitions. Similarly, Han et al (2019) apply Barraclough et al's (2013) approach to capture the wealth effect of Australian firms to the 2011 announcement of the Australian Carbon Pricing Scheme, demonstrating a contrast between the news effect and the value effect. We are unable to use such an approach as we do not have the necessary exogenous shock, that is, the two required states or their probabilities.…”

Section: Empirical Modelmentioning

confidence: 98%

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Excess Cash Holdings, Stock Returns, and Investment Organicity: Evidence from UK Investment Announcements

Jones

2022

Abacus

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This paper examines whether the market reaction to investment announcements is conditional on company excess cash holdings. Cash may convey significant price-relevant information about the future cash flows and strategic direction of a company. Using a sample of 4,256 corporate investment announcements by firms listed on the London Stock Exchange over the period 2005-2019, we show that market reactions to new company investment announcements are higher for firms with excess cash holdings. Furthermore, we provide evidence on the relationship between excess cash holdings and market valuation of various investment classes. The results reveal that organic investments are valued more highly by the market than inorganic investments, and the positive impact of excess cash holdings is more pronounced for the set of organic investment decisions, particularly product launches and R&D. Lastly, we evaluate how the motive for holding cash affects the market perception of excess cash holdings. The market views excess cash holdings as positive when cash is held as a result of high exposure to risk, high debt capacity, and high bid-ask spread. Market perception of excess cash holdings reverses from negative before to positive after the global financial crisis.

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Section: Empirical Modelmentioning

confidence: 98%

“…Similarly, Han et al . (2019) apply Barraclough et al . 's (2013) approach to capture the wealth effect of Australian firms to the 2011 announcement of the Australian Carbon Pricing Scheme, demonstrating a contrast between the news effect and the value effect.…”

Section: Hypothesis Developmentmentioning

confidence: 99%

Excess Cash Holdings, Stock Returns, and Investment Organicity: Evidence from UK Investment Announcements

Jones

2022

Abacus

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“…To a certain extent, this scheme has shifted the balance of competition between renewable energy and fossil fuels due to (a) increasing the cost of fossil fuel generation and (b) rendering renewable energy more viable. Cost represents the major barrier to renewable energy development, which requires much higher up-front capital costs when compared with fossil fuel generators (Han et al, 2019).…”

Section: Overview Of Australian Renewable Energy Programsmentioning

confidence: 99%

Impact of the Nature of Energy Management and Responses to Policies Regarding Solar and Wind Pricing: A Qualitative Study of the Australian Electricity Markets

Alsaedi

Tularam

Wong

2021

IJEEP

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The present study employed various qualitative techniques to investigate the nature and influence of policies and regulations concerning solar and wind pricing on the Australian electricity spot and options markets. The analysis was based on data gathered through interviews conducted with energy managers, chief executive officers and other significant personnel from the Australian electricity industry. The interviewees' responses regarding the solar and wind policies of relevance to the Australian electricity markets were examined, and the thick and in-depth content data derived from the interviews were used to examine how their views and personal politics influenced pricing within the electricity markets. The results suggest that renewable energy policies lower the electricity prices, reduce the risks for investors and also result in larger deployment mechanisms.

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“…In their study, Han et al (2019) are able to separate the news effect from the value effect associated with the announcement of the Australian Carbon Pricing Scheme (the "carbon tax") made on 24 February 2011. Their findings show that the news effect associated with the announcement is 1.11% (A$254 million dollars), indicating that the market was favourably disposed towards the news that the government was taking action on climate change.…”

Section: Han Linnenluecke Pan and Smithmentioning

confidence: 99%

Responsible science: Celebrating the 50-year legacy of using a registration-based framework

Aman

Beekes

Berkman

et al. 2019

Pacific-Basin Finance Journal

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This paper represents the intersection of three spheres of influence, highly relevant to the global research community interested in a more reliable understanding of capital market phenomena. First, as a timely context, we celebrate the 50-year legacy of an iconic paper on event studies, Ball and Brown (1968). Second, we add our voice to the growing call for researchers to follow principles of "responsible science". Third, using the Ball and Brown paper as their inspiration, we report on an experiment in which several teams of researchers follow a registration-based editorial process, which illustrates one fruitful avenue on how more responsible research can be fostered in the future.

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The wealth effects of the announcement of the Australian carbon pricing scheme

Cited by 19 publications

References 33 publications

Excess Cash Holdings, Stock Returns, and Investment Organicity: Evidence from UK Investment Announcements

Excess Cash Holdings, Stock Returns, and Investment Organicity: Evidence from UK Investment Announcements

Impact of the Nature of Energy Management and Responses to Policies Regarding Solar and Wind Pricing: A Qualitative Study of the Australian Electricity Markets

Responsible science: Celebrating the 50-year legacy of using a registration-based framework

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