ISSN (print) - 0131-7652

ISSN (online) - 2686-7605

Vol. 50 No. 5 (2020)
FINANCIAL ECONOMY

Distinctive Features of Cost of Capital on Green Bond Market

PDF (Русский)
  • M. Dorofeev
M. Dorofeev
Financial University Affiliated to the Government of Russian Federation, Moscow
Bio
DOI: https://doi.org/10.30680/ECO0131-7652-2020-5-62-76

Published 2020-05-01

Keywords

  • green finance,
  • cost of capital,
  • cost of debt,
  • green bonds,
  • green investments,
  • market efficiency,
  • risk premium
    • ...More
    Less

How to Cite

1.
Dorofeev М. Distinctive Features of Cost of Capital on Green Bond Market. ECO [Internet]. 2020 May 1 [cited 2024 Sep. 22];50(5):62-76. Available from: https://ecotrends.ru/index.php/eco/article/view/4023

Abstract

The paper explores the green bond market, a key instrument for financing of the growing green economy sector. Pricing features of this market are analyzed in terms of specific risk premiums/discounts. The methods of research comprise analysis review and systematization of results of scientific and empirical research into calculation of specific risk premiums to investors of green bonds provided by the financial market during the period of 2007–2019. The author found out that significant differences in the cost of raised capital via green bonds (–18 to 12 basis points to the cost of similar brown bonds) mainly depend on business reputation and status of securities issuers. For small and medium-sized private green bonds issuers, the cost of raised capital may be higher than for similar issuers of the classic debt market, which do not have green status.
PDF (Русский)

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