TY - GEN AB - We build the first news-based index of US environmental and climate policy and examine how it relates to clean investments. Extracting text from ten leading US newspapers over the last four decades, we use text-mining techniques to develop a granular news index of US environmental and climate policy (EnvP) over the 1981–2019 period. Furthermore, we develop a set of additional measures, namely an index of sentiment on environmental policy, as well as various topic-specific indexes. We validate our index by showing that it correctly captures trends and peaks in the evolution of US environmental and climate policy and that it has a meaningful association with clean investments, in line with environmental regulations supporting growing opportunities for clean markets. In firm-level estimations, we find that our index is associated with a greater probability of receiving venture capital (VC) funding for cleantech startups and reduced stock returns for high-emissions firms most exposed to environmental regulations. At the aggregate level, we find in VAR models that a shock in our news-based index of renewable energy policy is associated with an increase in the number of clean energy VC deals and in the assets under management of a benchmark clean energy exchange-traded fund. AU - Noailly, Joëlle AU - Nowzohour, Laura Minu AU - Van Den Heuvel, Matthias AU - Pla, Ireneu DA - 2024 DO - 10.1016/j.jpubeco.2024.105190 DO - doi ID - 319227 KW - Environment and the Anthropocene KW - Finance and Investment KW - Information and Media KW - Technology L1 - https://repository.graduateinstitute.ch/record/319227/files/1-s2.0-S0047272724001269-main.pdf L2 - https://repository.graduateinstitute.ch/record/319227/files/1-s2.0-S0047272724001269-main.pdf L4 - https://repository.graduateinstitute.ch/record/319227/files/1-s2.0-S0047272724001269-main.pdf LK - https://repository.graduateinstitute.ch/record/319227/files/1-s2.0-S0047272724001269-main.pdf N1 - This article is a substantially updated version of CIES Research Paper no. 70 published in 2021 (https://repository.graduateinstitute.ch/record/299407) N2 - We build the first news-based index of US environmental and climate policy and examine how it relates to clean investments. Extracting text from ten leading US newspapers over the last four decades, we use text-mining techniques to develop a granular news index of US environmental and climate policy (EnvP) over the 1981–2019 period. Furthermore, we develop a set of additional measures, namely an index of sentiment on environmental policy, as well as various topic-specific indexes. We validate our index by showing that it correctly captures trends and peaks in the evolution of US environmental and climate policy and that it has a meaningful association with clean investments, in line with environmental regulations supporting growing opportunities for clean markets. In firm-level estimations, we find that our index is associated with a greater probability of receiving venture capital (VC) funding for cleantech startups and reduced stock returns for high-emissions firms most exposed to environmental regulations. At the aggregate level, we find in VAR models that a shock in our news-based index of renewable energy policy is associated with an increase in the number of clean energy VC deals and in the assets under management of a benchmark clean energy exchange-traded fund. PY - 2024 T1 - Heard the news ?environmental policy and clean investments TI - Heard the news ?environmental policy and clean investments UR - https://repository.graduateinstitute.ch/record/319227/files/1-s2.0-S0047272724001269-main.pdf Y1 - 2024 ER -