Impact Of Environmental Pollution Liability Insurance On Financial Constraints And Environmental Investment

Nowadays,green finance is booming in China.Green insurance,as one of the important components of green finance,has been neglected in China.In contrast,green securities and green bonds have been supported by many national policies and various market players.The development of green economy strongly leads the development of China's economic market and lays a solid foundation for future development.The insurance market has always played an extremely important role in the mature capital market.As a professional risk management agency,insurance companies provide new directions for businesses and even the country and the government.Green insurance is a new member of China's insurance market which can not only play the role of basic risk management,but also improve the status of frequent environmental pollution accidents and the quality of development in China.Therefore,the improvement of the green insurance market is also extremely important for the development of China.China began to vigorously launch environmental pollution liability insurance in 2007 and has been encouraging companies to purchase environmental pollution liability insurance.However for more than a decade,China's environmental pollution liability insurance market has not been effectively promoted,and the insurance coverage rate is still very low,failing to demonstrate the effectiveness of insurance market.So it is of great importance for governments as well as enterprises that should pay more attention to the market of environmental pollution liability insurance.After reading the existing literature,it is found that Chinese scholars mainly focus on finding the causes and influencing factors of the supply and demand of environmental pollution liability insurance.Enterprises,as a micro entity,is affected mainly by profits when taking final investment decision.This article,based on the development of environmental pollution liability,combined with the characteristics of the insurance market and the environmental accidents,taking the information asymmetry theory,signal transmission mechanism,and external supervision hypothesis as theoretical basis,from the perspective of the enterprise,establishes a financial constraint index which is suitable for the sample and empirically analyzes the hypothesis.The first one is that environmental pollution liability insurance can or can not alleviate financing constraints,and can or can not promote the company's environmental investment,and examines the specific mechanism path of the company's environmental protection insurance impact on corporate environmental investment.Finally,through a simple OLS model regression,the proposed hypothesis is verified,that is,the insured can indeed alleviate the financing constraints of the enterprise,and can positively promote the companies' environmental investments.And through intermediary inspection,it was proved that the company purchasing environmental pollution liability insurance can further affect the companies' environmental investment by affecting the degree of financing constraints.Afterwards,the samples were grouped according to the particularity of China's market system,and it is found that the insured state-owned enterprises can significantly alleviated the financing constraints while the others can not.Similarly,the insured state-owned enterprises can better promote environmental investment of enterprises.However,according to the difference in marketization process,the mitigation effect of environmental insurance for enterprises on financing constraints does not have much difference between regions.Instead,there are significant differences on corporate envirnmental investment between insured and uninsured.The insured promote the environmental investment while the uninsured inhibit.In a more developed area,the insured significantly promote the environmental investment,while in a slower developed area,it is opposite.This empirical analysis provide companies with more intuitive results and offer a help for decision making.At the same time,the results also provide the government formulating policies,making sure that the government can better play the role of tangible hand.At a macro level,the empirical results of this paper exhibit the increasing social benefits taking by environmental pollution liability insurance.