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Pricing Green in a Red Turn

Gutesten, Erik LU and Alm, Tage LU (2026) BUSN79 20261
Department of Business Administration
Abstract
This study examines whether environmental performance and Republican political alignment explain abnormal returns around the 2024 U.S. election, and whether political alignment moderates this relationship. The results show positive aggregate abnormal returns around the election. Firms with higher environmental performance experienced lower cumulative abnormal returns, suggesting that investors reassessed its value under an expected shift toward weaker environmental regulation. Stronger Republican political alignment, based on donations, was associated with more favorable market reactions, particularly on the event day. The study finds no evidence that political alignment moderated the relationship between environmental performance and... (More)
This study examines whether environmental performance and Republican political alignment explain abnormal returns around the 2024 U.S. election, and whether political alignment moderates this relationship. The results show positive aggregate abnormal returns around the election. Firms with higher environmental performance experienced lower cumulative abnormal returns, suggesting that investors reassessed its value under an expected shift toward weaker environmental regulation. Stronger Republican political alignment, based on donations, was associated with more favorable market reactions, particularly on the event day. The study finds no evidence that political alignment moderated the relationship between environmental performance and abnormal returns. (Less)
Please use this url to cite or link to this publication:
author
Gutesten, Erik LU and Alm, Tage LU
supervisor
organization
course
BUSN79 20261
year
type
H1 - Master's Degree (One Year)
subject
keywords
Environmental performance, political alignment, political contributions, cumulative abnormal returns, The 2024 U.S. election
language
English
id
9245107
date added to LUP
2026-07-01 12:36:54
date last changed
2026-07-01 12:36:54
@misc{9245107,
  abstract     = {{This study examines whether environmental performance and Republican political alignment explain abnormal returns around the 2024 U.S. election, and whether political alignment moderates this relationship. The results show positive aggregate abnormal returns around the election. Firms with higher environmental performance experienced lower cumulative abnormal returns, suggesting that investors reassessed its value under an expected shift toward weaker environmental regulation. Stronger Republican political alignment, based on donations, was associated with more favorable market reactions, particularly on the event day. The study finds no evidence that political alignment moderated the relationship between environmental performance and abnormal returns.}},
  author       = {{Gutesten, Erik and Alm, Tage}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Pricing Green in a Red Turn}},
  year         = {{2026}},
}