Abstract

Purpose – Although an increasing body of research has examined the role of emission trading systems (ETS) at the macroeconomic level and their various effects at the firm level (Liu et al., 2022; Zhang et al., 2023; Ni et al., 2022; Huang et al., 2024; Ren et al., 2024), there remains a lack of systematic empirical analysis on the specific impact of pilot implementations in different regions on the cost of equity for high-carbon firms, particularly when accounting for varying levels of regional economic development and firm characteristics. Therefore, this study employs a difference-in-differences (DiD) approach to systematically analyze the impact of ETS pilots on the cost of equity for high-carbon firms.

Design/methodology/approach – From late 2013, several regions initiated carbon ETS pilots. ETS’s phased and orderly implementation provides an excellent quasi-natural experiment for formulating a DID model. The pilot regions span China’s eastern, central and western areas, covering various stages of socio-economic development, effectively representing China. To examine the impact of ETS on the cost of equity for high-carbon firms, we use a staggered DiD approach.

Findings – We find that the implementation of ETS significantly increases high-carbon firms’ cost of equity. Investors request more compensation for the increased stock return volatility, reduced operating cash flows and heightened distress risks following ETS. The effect is more pronounced for firms with severe financing constraints, while it is alleviated in state-owned enterprises and firms with higher institutional ownership. Additionally, the effect of ETS is stronger in areas with better governance capacity and economic conditions.

Originality/value – First, this paper complements to some extent the literature on the microeconomic consequences of carbon trading systems. Second, this paper has some policy implications by discussing the heterogeneity of ETS effects at firm and regional levels. We find that ETS had a greater impact on non-state-owned enterprises, suggesting that the government should support the transformation of non-state-owned enterprises by providing targeted assistance for complying with carbon-trading regulations and promoting green economic growth. Additionally, we find that ETS is more effective in economically developed areas with good governance capacity, which means that the government should tailor local carbon trading policies to each region’s governance and economic conditions and avoid a one-size-fits-all approach.

Researchers from the China Institute of Atomic Energy (CIAE) and Lanzhou University have jointly conducted systematic integral experiments using D-T and D-D neutron sources on natural lead (^natPb) slabs. By addressing key data gaps in large-angle neutron scattering and thoroughly validating four major evaluated nuclear data libraries, this study establishes new benchmark data, supporting safer reactor designs, advanced fusion systems, and optimized radiation shielding applications.

A new study published in Engineering offers fresh insights into Alzheimer’s disease, revealing that inhibiting an enzyme called ST6Gal-I can reduce levels of BACE1 and amyloid-β plaques, which are key factors in the disease’s progression. This research underscores the potential of targeting glycosylation pathways as a strategy for developing new treatments for Alzheimer’s.

In a recent article published in Engineering, researchers Li Guo and Jinghai Li from the Chinese Academy of Sciences explore the future development of artificial intelligence (AI), emphasizing the need for consistency in the logical structures of datasets, AI models, model-building software, and hardware. They argue that while current AI systems excel at handling statistical properties of complex systems, they face challenges in effectively representing spatiotemporal complexity patterns. The authors propose integrating principles of multilevel complexity into AI development to enhance its functionality and reliability in engineering applications.

Perovskite-structured BaFe_0.4Co_0.4Zr_0.1Y_0.1O_3-δ (BFCZY) exhibits proton-electron-oxygen ion triple conductions and high catalytic activity of oxygen reduction (ORR) and oxygen evolution reaction (OER) at low temperatures. Although it has stability problems in a humid air environment, the degradation mechanism of BFCZY and the influences of temperature, steam content and polarization on its stability have been rarely studied. The activity and stability of the BFCZY oxygen electrode are significantly improved through heterointerface engineering by infiltrating the BaCoO₃ (BCO) catalyst. It is imperative to fill this research gap, as it is crucial for promoting the commercial development of reversible protonic ceramic electrochemical cells (R-PCECs).