Department of Economics
Job Market Candidates
JOB MARKET CANDIDATES 2024/2025 |
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Jinhong Wu
Areas of interest: I am an applied economist broadly working in the areas of climate risks, sustainable finance, banking, and corporate economics. My current research focuses on firms’ exposure to increasing climate risks, their relationship with the credit markets, and their impacts on firms’ performance and behaviors. |
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Job Market Paper:
This study examines how firms’ exposure to climate-related physical and transition risks affects bank credit allocation. Using novel, granular measures for both risk types, merged with matched firm-bank data from Danish registers, I find that banks reduce credit growth to firms with higher physical and transition risks. A one standard deviation increase in each type of risk results in a 1%-2% reduction in loan growth, representing about an 8%-16% deviation from the mean. These effects are most pronounced for constrained firms (e.g., small or highly leveraged) and are concentrated within banks with high exposure to risk and repeat lending relationships. Additionally, the evidence suggests that more credit is allocated to risky but “greening” firms and firms with low combined physical and transition risks. Finally, the credit supply side is likely to play a more important role in the observed effect, partly due to banks’ credit risk concerns. |
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