Smog Pollution, Environmental Uncertainty, and Operating Investment

Smog pollution in China has drawn worldwide attention. Using companies’ data from Chinese Securities Markets and Accounting Research database (CSMAR) and air quality monitoring data from China National Environmental Monitoring Centre(CNEMC), we employ the <i>PM</i><sub>2.5</sub&...

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Autores principales:	Bin Li, Hanxuan Shi, David C. Yang, Muze Peng
Formato:	article
Lenguaje:	EN
Publicado:	MDPI AG 2021
Materias:	smog pollution environmental uncertainty operating investment Meteorology. Climatology QC851-999
Acceso en línea:	https://doaj.org/article/ce0213b8f81d4d81952aef0616688011
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spelling	oai:doaj.org-article:ce0213b8f81d4d81952aef06166880112021-11-25T16:43:54ZSmog Pollution, Environmental Uncertainty, and Operating Investment10.3390/atmos121113782073-4433https://doaj.org/article/ce0213b8f81d4d81952aef06166880112021-10-01T00:00:00Zhttps://www.mdpi.com/2073-4433/12/11/1378https://doaj.org/toc/2073-4433Smog pollution in China has drawn worldwide attention. Using companies’ data from Chinese Securities Markets and Accounting Research database (CSMAR) and air quality monitoring data from China National Environmental Monitoring Centre(CNEMC), we employ the <i>PM</i><sub>2.5</sub> concentration as a proxy for smog pollution and examine the effect of smog pollution on company environmental uncertainty and operating investment in 74 key cities in China. The empirical results show that smog pollution causes an increase in company environmental uncertainty and a decrease in operating investment for Chinese listed companies, with environmental uncertainty as a mediating variable. Smog pollution can positively influence companies’ environmental uncertainty through their employees and high pressure from the public and government. According to the real-options-based investment approach, companies choose to “wait and see” and, correspondingly, reduce operating investment under high environmental uncertainty such as that caused by smog pollution. Additionally, we find that state-owned enterprises are more significantly influenced by smog pollution in terms of environmental uncertainty and operating investment because of their close relationships with the government and their responsibility to set an example among Chinese companies in the fight against smog pollution.Bin LiHanxuan ShiDavid C. YangMuze PengMDPI AGarticlesmog pollutionenvironmental uncertaintyoperating investmentMeteorology. ClimatologyQC851-999ENAtmosphere, Vol 12, Iss 1378, p 1378 (2021)
institution	DOAJ
collection	DOAJ
language	EN
topic	smog pollution environmental uncertainty operating investment Meteorology. Climatology QC851-999
spellingShingle	smog pollution environmental uncertainty operating investment Meteorology. Climatology QC851-999 Bin Li Hanxuan Shi David C. Yang Muze Peng Smog Pollution, Environmental Uncertainty, and Operating Investment
description	Smog pollution in China has drawn worldwide attention. Using companies’ data from Chinese Securities Markets and Accounting Research database (CSMAR) and air quality monitoring data from China National Environmental Monitoring Centre(CNEMC), we employ the <i>PM</i><sub>2.5</sub> concentration as a proxy for smog pollution and examine the effect of smog pollution on company environmental uncertainty and operating investment in 74 key cities in China. The empirical results show that smog pollution causes an increase in company environmental uncertainty and a decrease in operating investment for Chinese listed companies, with environmental uncertainty as a mediating variable. Smog pollution can positively influence companies’ environmental uncertainty through their employees and high pressure from the public and government. According to the real-options-based investment approach, companies choose to “wait and see” and, correspondingly, reduce operating investment under high environmental uncertainty such as that caused by smog pollution. Additionally, we find that state-owned enterprises are more significantly influenced by smog pollution in terms of environmental uncertainty and operating investment because of their close relationships with the government and their responsibility to set an example among Chinese companies in the fight against smog pollution.
format	article
author	Bin Li Hanxuan Shi David C. Yang Muze Peng
author_facet	Bin Li Hanxuan Shi David C. Yang Muze Peng
author_sort	Bin Li
title	Smog Pollution, Environmental Uncertainty, and Operating Investment
title_short	Smog Pollution, Environmental Uncertainty, and Operating Investment
title_full	Smog Pollution, Environmental Uncertainty, and Operating Investment
title_fullStr	Smog Pollution, Environmental Uncertainty, and Operating Investment
title_full_unstemmed	Smog Pollution, Environmental Uncertainty, and Operating Investment
title_sort	smog pollution, environmental uncertainty, and operating investment
publisher	MDPI AG
publishDate	2021
url	https://doaj.org/article/ce0213b8f81d4d81952aef0616688011
work_keys_str_mv	AT binli smogpollutionenvironmentaluncertaintyandoperatinginvestment AT hanxuanshi smogpollutionenvironmentaluncertaintyandoperatinginvestment AT davidcyang smogpollutionenvironmentaluncertaintyandoperatinginvestment AT muzepeng smogpollutionenvironmentaluncertaintyandoperatinginvestment
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Smog Pollution, Environmental Uncertainty, and Operating Investment

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