What question did this study set out to answer?

To evaluate how opening financial markets to foreign capital influences country-level emissions of carbon dioxide, greenhouse gases, and sulfur dioxide.

September 16, 2026Journal of money credit and bankingOpen Access

The Effects of Financial Liberalization on Country‐Level Emissions

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To evaluate how opening financial markets to foreign capital influences country-level emissions of carbon dioxide, greenhouse gases, and sulfur dioxide.
Applied a difference-in-differences empirical design evaluating country-level financial liberalization shocks.
Adjusted for Gross Domestic Product (GDP) to isolate financial effects from baseline economic expansion.
Conducted a placebo test distinguishing between corporate and household emission sources.
Financial liberalization led to an economically large and statistically significant 21.7% increase in carbon dioxide emissions over a 10-year horizon following GDP adjustment.
Placebo testing revealed that post-liberalization emission surges were driven by corporate activity rather than household emission behavior.

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Implication

Difference-in-differences analysis reveals increased carbon dioxide emissions following financial market liberalization across countries, indicating corporate expansion drives national...

Cite This Study

Ceulemans et al. (2026) studied this question.

synapsesocial.com/papers/6aab42284a8222da8c3fcdc5 https://doi.org/10.1111/jmcb.70090

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Implication

Difference-in-differences analysis reveals increased carbon dioxide emissions following financial market liberalization across countries, indicating corporate expansion drives national...

The Effects of Financial Liberalization on Country‐Level Emissions

Key Points

Discussion

Implication

Cite This Study

The Effects of Financial Liberalization on Country‐Level Emissions

Key Points

Discussion

Implication

Cite This Study

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