Market Reactions to the Introduction of Voluntary Carbon Trading

Evidence From Taiwan

Bibliographic Data

ID21393026
AuthorsShu‐Han Hsu (0000-0002-2588-4549, School of Accounting and Finance, National Taipei University of Business Taipei Taiwan), Wei‐Cheng Chen (0000-0001-9680-7500, Institute of Economics, College of Social Sciences, National Sun Yat‐Sen University Kaohsiung City Taiwan, corresponding author), Yiwen Yang (0000-0002-1225-4804, Department of Civic Education and Leadership College of Education, National Taiwan Normal University Taipei Taiwan)
Year2026
Publication date2026-04-20
Open AccessYes
TypeARTICLE
VenueScottish Journal of Political Economy (JOURNAL)
Journal identifiersISSN: 0036-9292 • E-ISSN: 1467-9485
PublisherWiley (PUBLISHER • GB)
DOI10.1111/sjpe.70072
OpenAlexW7154939600
LanguageEN
References cited57

The literature has primarily focused on regulated and compliance‐oriented carbon markets and has rarely explored the effects of voluntary carbon‐rights trading (VCRT) across industries. The present study employs an event‐study approach to examine industry‐level stock‐return responses to Taiwan's announcement of a VCRT policy. The results reveal that market reactions are concentrated in the post‐event window and produce negative abnormal returns for carbon‐intensive and low‐tech industries, while producing positive abnormal returns for high‐tech industries. These patterns suggest that investors reassess firms' exposure to transition risks and opportunities associated with VCRT and highlight the importance of aligning corporate strategies with climate‐related policy signals

Carbon fibers · Carbon market · Transition (genetics) · Turnover · Voluntary disclosure · Window of opportunity · Corporate Social Responsibility Reporting · Regulation and Compliance Studies · Sustainable Finance and Green Bonds

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