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Environmental policies, national culture, and stock price crash risk: Evidence from renewable energy firms

Yildiz, Y., Karan, M.B. (2020) Environmental policies, national culture, and stock price crash risk: Evidence from renewable energy firms. Business Strategy and the Environment, 29 (6). pp. 2374-2391. ISSN 0964-4733. (doi:10.1002/bse.2508) (KAR id:100053)


This study investigates the impact of country-level environmental performance and national culture on the stock price crash risk of renewable energy firms. Employing a large sample of 626 renewable energy firms across 31 countries, we find a significant nonlinear relationship between country-level environmental performance and crash risk. National culture dimensions are found to strongly predict the crash risk of renewable energy firms, particularly after the global financial crisis. On the contrary, national culture dimensions and environmental policies are observed to not exert any significance in explaining the crash risk of fossil fuel firms. Our results are robust with respect to alternative measures of stock price crash risk and the endogeneity of national culture dimensions. Overall, the findings of this paper contribute to the environmental economics literature by providing new evidence regarding the role of societal and environmental factors in explaining the stock price crash risk of energy firms.

Item Type: Article
DOI/Identification number: 10.1002/bse.2508
Uncontrolled keywords: alternative energy; cultural relations; environmental economics; environmental impact; environmental policy; financial crisis; price dynamics; social impact; stock market
Subjects: H Social Sciences
Divisions: Divisions > Kent Business School - Division > Department of Accounting and Finance
Funders: University of Huddersfield (
Depositing User: Yilmaz Yildiz
Date Deposited: 17 Feb 2023 12:15 UTC
Last Modified: 01 Mar 2024 14:44 UTC
Resource URI: (The current URI for this page, for reference purposes)

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