Bushnell, James; Mansur, Erin T.; Chong, Howard G. - Department of Economics, Iowa State University - 2010
We investigate the effect of cap-and-trade regulation of CO2 on firm profits by performing an event study of a CO2 price crash in the EU market. We examine returns for 90 stocks from carbon intensive industries and 600 stocks in the broad EUROSTOXX index. Firms in carbon intensive, or...