| Summary/Abstract |
The government intervention directly achieves the strategic variation of industrial sector. Following this, the current study analyzes the impact of government concerns for green environment on investment decisions of industrial sector and how this effect changes across the countries that have developed financial sector. The sample size consists of financial statistics for the year 2007–2016 of non-financial sector firms from 11 selected economies of Asia. We employ panel EGLS (estimated generalized least square) and two-step system GMM (generalized method of moments) model due to problem of heteroskedasticity and endogeneity relatively. The statistical outputs of both models imply that carbon taxation has a negative impact while other green environmental strategies i.e., renewable energy utilization, production of electricity from renewable energy sources, and green growth productivity positively and significantly influence real investment decisions. Additionally, the statistical analysis illustrates the moderating impact of financial sector development on aforementioned relationship. The current analysis corroborates the thoughts of Porter's hypothesis and direct the important policy recommendations regarding environmental policies and their dynamical role in industrial sector investment decisions. Industrial sector should transform its energy needs from conventional energy production sources to renewable energy production due to positive impacts of renewable sources on investment.
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