OpenLB
Open Library of Bioscience
Advanced Search
Environmental science and pollution research international
May, 2023;30 (21): 60678-60693.

Does green finance stimulate green innovation of heavy-polluting enterprises? Evidence from green finance pilot zones in China.

Chenyang Ran, Yuru Zhang
Author Information
  1. Chenyang Ran: School of Economics and Management, Dalian University of Technology, Dalian, 116024, People's Republic of China. chenyangran@mail.dlut.edu.cn. ORCID
  2. Yuru Zhang: School of Economics and Management, China University of Petroleum, Qingdao, 266580, People's Republic of China.
PMID: 37039919 DOI: 10.1007/s11356-023-26758-z

Abstract

There is a relative dearth of empirical studies quantitatively analyzing the implementation effect of green finance reform and innovation pilot zones (GFRIs) on green innovation at the micro-enterprise level. Thus, this paper aims to construct the difference-in-difference-in-difference method to explore the influence of Chinese GFRIs on corporate green innovation of heavy-polluting enterprises based on green patent data. Results show that the pilot policy has significantly decreased green patents of heavy-polluting enterprises by approximately 42.64%, indicating that the policy has a significant innovation inhibition effect and fails to exert the Porter effect. Furthermore, establishing GFRIs has a more effective inhibition effect on the green invention patent than the green utility model patent. Moreover, although enterprises of different scales have different innovation capabilities, the negative impact of GFRIs on green innovation of heavy-polluting enterprises is widespread. Still, the negative impact is more pronounced for big-scale enterprises. The above empirical evidence is essential in formulating green finance development strategies and promoting green economic transformation.

Keywords

China’s GFRI pilot zones DDD method Green finance Green innovation Green patent

References

  1. Abadie A, Diamond A, Hainmueller J (2015) Comparative politics and the synthetic control method. Am J Polit Sci 59(2):495–510 [DOI: 10.1111/ajps.12116]
  2. Aizawa M, Yang C (2010) Green credit, green stimulus, green revolution? China’s mobilization of banks for environmental cleanup. J Environ Dev 19(2):119–144 [DOI: 10.1177/1070496510371192]
  3. Alpay E, Kerkvliet J, Buccola S (2002) Productivity growth and environmental regulation in Mexican and US food manufacturing. Am J Agr Econ 84(4):887–901 [DOI: 10.1111/1467-8276.00041]
  4. Barbera AJ, McConnell VD (1990) The impact of environmental regulations on industry productivity: direct and indirect effects. J Environ Econ Manag 18(1):50–65 [DOI: 10.1016/0095-0696(90)90051-Y]
  5. Bertrand M, Duflo E, Mullainathan S (2004) How much should we trust differences-in-differences estimates? Q J Econ 119(1):249–275 [DOI: 10.1162/003355304772839588]
  6. Boyd GA, McClelland JD (1999) The impact of environmental constraints on productivity improvement in integrated paper plants. J Environ Econ Manag 38(2):121–142 [DOI: 10.1006/jeem.1999.1082]
  7. Cai X, Lu Y, Wu M, Yu L (2016) Does environmental regulation drive away inbound foreign direct investment? Evid Quasi-Nat Exp China J Dev Econ 123:73–85
  8. Chen (2020) Financial structure, technological innovation, and carbon emission: on the development of Green financial system. Soc Sci Guangdong 4:41–50
  9. Chen Z, Zhang X, Chen F (2021) Do carbon emission trading schemes stimulate green innovation in enterprises? Evidence from China. Technol Forecast Soc Chang 168:120744 [DOI: 10.1016/j.techfore.2021.120744]
  10. Costantini V, Crespi F, Palma A (2017) Characterizing the policy mix and its impact on eco-innovation: a patent analysis of energy-efficient technologies. Res Policy 46(4):799–819 [DOI: 10.1016/j.respol.2017.02.004]
  11. Gray WB (1987) The cost of regulation: OSHA, EPA and the productivity slowdown. Am Econ Rev 77(5):998–1006
  12. Greenstone M, List JA, Syverson C (2012) The effects of environmental regulation on the competitiveness of US manufacturing (No. w18392). National Bureau of Economic Research
  13. Hao F, Xie Y, Liu X (2020) The impact of green credit guidelines on the technological innovation of heavily polluting enterprises: a quasi-natural experiment from China. Math Probl Eng 2020:1–13
  14. Hering L, Poncet S (2014) Environmental policy and exports: evidence from Chinese cities. J Environ Econ Manag 68:296–318 [DOI: 10.1016/j.jeem.2014.06.005]
  15. Huang H, Zhang J (2021) Research on the environmental effect of green finance policy based on the analysis of pilot zones for green finance reform and innovations. Sustainability 13(7):3754 [DOI: 10.3390/su13073754]
  16. IPCC (2021) Climate change 2021: The physical science basis. Cambridge University Press
  17. Irfan M, Razzaq A, Sharif A, Yang X (2022) Influence mechanism between green finance and green innovation: exploring regional policy intervention effects in China. Technol Forecast Soc Chang 182:121882 [DOI: 10.1016/j.techfore.2022.121882]
  18. Jiang FX, Wang ZJ, Bai JH (2013) The dual effect of environmental regulations’ impact on innovation—an empirical study based on dynamic panel data of Jiangsu manufacturing. China Ind Econ 7:44–55
  19. Kaul A (2012) Technology and corporate scope: firm and rival innovation as antecedents of corporate transactions. Strateg Manag J 33:347–367 [DOI: 10.1002/smj.1940]
  20. Kelm KM, Narayanan VK, Pinches GE (1995) Shareholder value creation during R&D innovation and commercialization stages. Acad Manag J 38(3):770–786 [DOI: 10.2307/256745]
  21. Kemp R (2008) Measuring eco-innovation. UNU
  22. Lemmon M, Roberts MR (2010) The response of corporate financing and investment to changes in the supply of credit. J Financ Quant Anal 45(3):555–587 [DOI: 10.1017/S0022109010000256]
  23. Li Q, Xiao Z (2020) Heterogeneous environmental regulation tools and green innovation incentives: evidence from green patents of listed companies. Econ Res J 55:192–208
  24. Li W, Zheng M (2016) Is it substantive innovation or strategic innovation? Impact of macroeconomic policies on micro-enterprises innovation. Econ Res J 4:60–73
  25. Li C, Qi Y, Liu S, Wang X (2022) Do carbon ETS pilots improve cities’ green total factor productivity? Evidence from a quasi-natural experiment in China. Energy Econ 108:105931 [DOI: 10.1016/j.eneco.2022.105931]
  26. Liu C, Fang J, Xie R (2021) Energy policy and corporate financial performance: evidence from China’s 11th five-year plan. Energy Econ 93:105030 [DOI: 10.1016/j.eneco.2020.105030]
  27. Lu J, Yan Y, Wang T (2021) The microeconomic effects of green credit policy from the perspective of technological innovation and resource reallocation. China Ind Econ 01:174–192
  28. Luong H, Moshirian F, Nguyen L, Tian X, Zhang BH (2017) How do foreign institutional investors enhance firm innovation? J Financ Quant Anal 52(4):1449–1490 [DOI: 10.1017/S0022109017000497]
  29. Olden A, Møen J (2022) The triple difference estimator. Econ J 25(3):531–553
  30. Porter ME, Van der Linde C (1995) Toward a new conception of the environment-competitiveness relationship. J Econ Perspect 9(4):97–118 [DOI: 10.1257/jep.9.4.97]
  31. Qi S, Lin S, Cui J (2018) Do environmental rights trading schemes induce green innovation? Evidence from listed firms in China. Econ Res J 53(12):129–143
  32. Ren X, Shao Q, Zhong R (2020) Nexus between green finance, non-fossil energy use, and carbon intensity: empirical evidence from China based on a vector error correction model. J Clean Prod 277:122844 [DOI: 10.1016/j.jclepro.2020.122844]
  33. Rubashkina Y, Galeotti M, Verdolini E (2015) Environmental regulation and competitiveness: empirical evidence on the Porter Hypothesis from European manufacturing sectors. Energy Policy 83:288–300 [DOI: 10.1016/j.enpol.2015.02.014]
  34. Salazar J (1998) Environmental finance: linking two world. In a Workshop on financial innovations for biodiversity Bratislava (Vol. 1, pp. 2-18)
  35. Su D, Lian L (2018) Does green credit policy affect corporate financing and investment? Evidence from publicly listed firms in pollution-intensive industries. J Financ Res 12:123–137
  36. Tan Y, Zhu Z (2022) The effect of ESG rating events on corporate green innovation in China: the mediating role of financial constraints and managers’ environmental awareness. Technol Soc 68:101906
  37. Tanaka S (2015) Environmental regulations on air pollution in China and their impact on infant mortality. J Health Econ 42:90–103 [DOI: 10.1016/j.jhealeco.2015.02.004]
  38. Tong TW, He W, He ZL, Lu J (2014) Patent regime shift and firm innovation: Evidence from the second amendment to China’s patent law. In Academy of management proceedings (Vol. 2014, No. 1, p. 14174). Briarcliff Manor, NY 10510: Academy of Management
  39. Wang XH, Liu JH, Zhao YX (2021b) Effectiveness measurement of green finance reform and innovation pilot zone. J Quant Tech Econ 38(10):107–127
  40. Wang Y, Zhao N, Lei X, Long R (2021a) Green finance innovation and regional green development. Sustainability 13(15):8230 [DOI: 10.3390/su13158230]
  41. Xiang X, Liu C, Yang M (2022) Who is financing corporate green innovation? Int Rev Econ Financ 78:321–337 [DOI: 10.1016/j.iref.2021.12.011]
  42. Xu X, Li J (2020) Asymmetric impacts of the policy and development of green credit on the debt financing cost and maturity of different types of enterprises in China. J Clean Prod 264:121574 [DOI: 10.1016/j.jclepro.2020.121574]

MeSH Term

China
Empirical Research
Policy
Environmental Pollution
Journal Article

Word Cloud

Created with Highcharts 10.0.0greeninnovationfinanceenterpriseseffectpilotGFRIsheavy-pollutingpatentzonesGreenempiricalmethodpolicyinhibitiondifferentnegativeimpactrelativedearthstudiesquantitativelyanalyzingimplementationreformmicro-enterpriselevelThuspaperaimsconstructdifference-in-difference-in-differenceexploreinfluenceChinesecorporatebaseddataResultsshowsignificantlydecreasedpatentsapproximately4264%indicatingsignificantfailsexertPorterFurthermoreestablishingeffectiveinventionutilitymodelMoreoveralthoughscalescapabilitieswidespreadStillpronouncedbig-scaleevidenceessentialformulatingdevelopmentstrategiespromotingeconomictransformationstimulateenterprises?EvidenceChinaChina’sGFRIDDD

Similar Articles

Cited By