Does ownership matter in driving green subsidies effects? A quasi natural experiment in China

Kebin Deng, Zhong Ding, Liuyang Ren and Ziyun Xiang

Economic Analysis and Policy, 2025, vol. 85, issue C, 1079-1104

Abstract: Using the green-performance-evaluation policy boosting green subsidies for heavy polluting enterprises as a quasi-natural experiment, we employ the difference-in-differences (DID) method to confirm the substantial ownership impact on the relation between green subsidies and corporate environmental investment. Our findings indicate that state-owned involved enterprises significantly increase their environmental investment following the receipt of green subsidies, whereas non-state-owned involved enterprises temporarily reduce their environmental investment after receiving green subsidies. Mechanism analysis reveals that these differences stem from the inherent alignment between the objectives of state-owned enterprises and the government.

Keywords: Green subsidies; Corporate environmental investment; Ownership; Environmental performance (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecanpo:v:85:y:2025:i:c:p:1079-1104

DOI: 10.1016/j.eap.2025.01.015

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