Climate policy uncertainty and corporate green innovation: Evidence from Chinese A-share listed industrial corporations

Dongbei Bai, Lizhao Du, Yang Xu and Shujaat Abbas

Energy Economics, 2023, vol. 127, issue PB

Abstract: Confronted with the increasingly severe climate change, frequent changes in Chinese government decrees have enhanced climate policy uncertainty. This study explores the relationship between climate policy uncertainty (CPU) and corporate green innovation (GI) using data from A-share industrial companies listed in China's Shanghai and Shenzhen markets from 2011 to 2020. Results show that climate policy uncertainty positively contributes to firms' green innovation. Secondly, there is significant heterogeneity in the effect of uncertainty in climate policy on firms' green innovation, with a more substantial effect on non-state enterprises, energy-providing industries, and technology-intensive firms. Furthermore, climate policy uncertainty can increase regional environmental regulations and the level of R&D investment by firms, leading to an increase in the level of green innovation by firms. Reducing differential policy treatment by governments and increasing R&D investment by firms are, therefore, important ways to enhance green innovation and improve the competitiveness of enterprises.

Keywords: Climate policy uncertainty; Corporate green innovation; Environmental regulation; Corporate research and development (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:127:y:2023:i:pb:s0140988323005182

DOI: 10.1016/j.eneco.2023.107020

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