Environmental Regulation and Green Technology Innovation: Evidence from China’s Heavily Polluting Companies

Zhouzhou Lin, Dezhi Liang () and Shengnan Li
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Zhouzhou Lin: Department of Management Science, School of Politics and Public Administration, Soochow University, Suzhou 215123, China
Dezhi Liang: Department of Business Administration, School of Economics and Management, Harbin Engineering University, Harbin 150001, China
Shengnan Li: Department of Accounting and Financial Management, School of Economics and Management, Nanjing Tech University, Nanjing 211816, China

Sustainability, 2022, vol. 14, issue 19, 1-18

Abstract: The green transformation of heavily polluting companies is essential for sustainable development. This study investigated the direct effects of environmental regulation on two types of green technology innovations at the microlevel and explored the moderating effects of three levels of firm supervision—government, public, and internal. Analyzing a panel of China’s heavily polluting companies during 2011–2020, we find that environmental regulation inhibits both types of green technology innovation. However, the degree of such inhibition varies with different moderators. Specifically, lower environmental pressure and better internal corporate controls can weaken or even reverse the inhibition of green invention innovation, while higher media attention can weaken the inhibition of green utility-model innovation. Our findings thus extend the literature on the scenarios of environmental regulation by revealing the heterogeneous moderating effects of government-, public-, and firm-level factors on two types of green innovation. Moreover, our findings have practical implications for promoting the green transformation of heavily polluting companies.

Keywords: environmental regulation; green technology innovation; stakeholder theory; moderating effects; heavily polluting companies (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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