Impact of accelerated depreciation policies for fixed assets on firms’ green innovation performance

Yuanheng Li, Xinyu Chai, Ruiqian Su and Kedong Chen ()

Finance Research Letters, 2025, vol. 74, issue C

Abstract: Green innovation is essential for sustainable enterprise development. Using data from A-share listed companies on the Shanghai and Shenzhen stock exchanges in China, this study examines how accelerated depreciation policies for fixed assets affect firms’ green innovation performance. The results demonstrate that such policies can enhance enterprises’ green innovation, with a stronger effect on substantive green innovation than strategic green innovation. The moderating effect analysis reveals that environmental regulations and green awareness among corporate executives strengthen the incentivizing effect of accelerated depreciation policies on substantive green innovation but not strategic green innovation. Further analysis shows that substantive green innovation increases enterprises’ sustainable development capabilities and corporate value significantly more than strategic green innovation. These findings provide empirical evidence for optimizing tax incentive policies’ green innovation performance and provide enterprises with valuable insights to improve sustainable development capabilities.

Keywords: Accelerated depreciation policy for fixed asset; Green innovation; Substantive green innovation; Strategic green innovation (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:74:y:2025:i:c:s1544612325000819

DOI: 10.1016/j.frl.2025.106816

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