Document Type

Thesis or dissertation

Date of this Version



Adrian E. Tschoegl and Shuang (Frank) Zhou


This paper analyses the existence of a greemium i.e., an investor or issuer green bond premium in the primary fixed income and securities market across time. To achieve this, I examine issue yield differentials and issue price differentials between matched samples of green and conventional bonds, which are examined through time series, regression and difference-in-difference analyses. The issuer premium is evaluated in terms of favorable price, while the investor premium is defined in terms of favorable yield. The results suggest that green bonds have had an investor premium based on a positive yield (3.6 basis points). There is no significant change in the price over time. The diff-in-diff analysis gives further clarity regarding the impact of the introduction of the Green Bond Principles in 2014. It was observed that prior to the introduction of the GBP there was an issuer price premium and an investor yield discount. However, after the GBP was introduced, the result was an issuer price discount or an investor yield premium. The target audience for this study is academics, along with issuers and investors in the bond market. The study expands upon academic research in the areas of environmentalism and finance to further understand the viability of green bonds both for improved social responsibility and financial performance.


green bonds, greemium, green bond principles, gbp, price differential, yield differential, investor premium, investor discount, issuer premium, issuer discount



Date Posted: 20 May 2020


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