Digital government and corporate green innovation: Evidence from “internet + government services” in China

Zengmin Cao, Jian Lu and Ruiqi Sun

International Review of Economics & Finance, 2025, vol. 103, issue C

Abstract: This study primarily focuses on examining the relationship between digital government and corporate green innovation performance, investigating the pivotal role of digital government in fostering the advancement of corporate green innovation. As a critical component of China's modernization efforts in its governance structure and administrative capacities, the influence of digital government on driving corporate green innovation is particularly important. Building on the “Internet + Government Services” pilot policy, which serves as a quasi-natural experiment for digital government, this research develops an analytical framework to examine the ways in which digital government affects corporate green innovation performance through various mechanisms. Using panel data from publicly listed companies in China over the period from 2010 to 2023, this study applies the Difference-in-Differences (DID) model and mediation effect models to empirically analyze the mechanisms and heterogeneity underlying the connection between digital government and corporate green innovation. The findings indicate that: (1) digital government significantly promotes corporate green innovation in pilot cities; (2) the policy effectively enhances corporate green innovation through better access to environmental subsidy information and by curbing corporate greenwashing behavior; (3) digital government not only enhances the quality of corporate green innovation in pilot cities, but also significantly strengthens green innovation in enterprises with advanced digital capabilities, and elevates corporate green innovation in cities with advanced financial development and heightened public environmental awareness. The results of this research offer valuable policy insights for local governments in fostering corporate green innovation and provide strategic recommendations for enterprises on enhancing their green innovation capabilities.

Keywords: Digital government; Green innovation; Difference-in-Differences model; Environmental subsidies; Greenwashing (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:103:y:2025:i:c:s1059056025007154

DOI: 10.1016/j.iref.2025.104552

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