Introduction: Water, as an essential strategic resource, is diminishing; this has been framed as a financial risk. We aim to quantitively investigate the impact of water use and technology on the stock market and compare the differences in China and Japan, which represent emerging and mature markets, respectively.Method: We constructed three models using the difference generalized method of moments. The first and second models focused on how water use could influence stock market volatility and returns; the third model added technology as an interaction to explore its impact on the above mechanism. We used an ARIMA-EGARCH model to predict the trend of marginal stock market return with an increase in industrial water use in the next 5 years.Results and Discussion: The results show that 1) water use increases the stock market volatility in both countries, but Japan shows a greater increase than China; 2) water use has a negative impact on stock market returns in China and a positive impact in Japan; 3) technology plays a positive role in the second model, while the ARIMA-EGARCH results correspond to the first two conclusions, which verifies the reasonability of the models. We conclude that heterogeneity exists in the two different market types because of technology level.
We study the relationship between green credit and ecological welfare performance, green credit’s mechanism, and future trends of ecological welfare performance in China. We aim to determine whether the green credit policy has a positive or negative effect on ecological welfare performance and to give suggestions about green credit for emerging markets, with China as an example. These problems are evaluated with two empirical models by using quadratic and interaction terms, as well as a time series model, ARIMA(2,3,2). The results show that the relationship between green credit and ecological welfare performance is an inverted U shape, and ecological welfare performance peaks when loans approach 2934.2 billion yuan, which equals 441.7446 billion dollars, corresponding to loans between 2015 and 2016. In addition, national income and ecological footprint have a suppressive effect on the impact of green credit on ecological welfare performance, and lifespan can positively affect the mechanism. Moreover, the result of ARIMA(2,3,2) corresponds to previous results and indicates that the ecological welfare performance will fluctuate within a range if green credits continue to be issued.
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