Fiscal Decentralization, Environmental Regulation, and Green Technological Innovation: Evidence from China

Changyun Zhou, Junxi Zhu and Zhuo Chen ()
Additional contact information
Changyun Zhou: School of Accounting, Southwestern University of Finance and Economics, Chengdu 611130, China
Junxi Zhu: School of Finance, Southwestern University of Finance and Economics, Chengdu 611130, China
Zhuo Chen: Chengdu Airport Xingcheng Investment Group Co., Ltd., Chengdu 611130, China

Sustainability, 2024, vol. 16, issue 11, 1-17

Abstract: To achieve carbon peaking and neutrality, optimizing power allocation and fiscal responsibilities between China's central and local authorities is essential for balancing environmental and economic goals. This study employs fixed-effects panel regression and a threshold model to examine the relationships between fiscal decentralization, environmental regulations, and green technological innovation in 271 prefecture-level cities from 2007 to 2019. The results reveal that environmental regulations significantly advance green innovation. Fiscal decentralization modulates the impact of these regulations on green innovation, with regional variations. In central and western areas, fiscal decentralization inhibits the regulatory effects, whereas in the eastern region, it promotes them. Moreover, fiscal decentralization exhibits a threshold effect: below a certain threshold, it hinders regulatory impact, but beyond that threshold, it enhances it. These findings offer valuable insights for policy decisions and strategies to foster green innovation, providing a theoretical and empirical foundation for policymakers involved in environmental and fiscal planning.

Keywords: fiscal decentralization; environmental regulation; green technological innovation; regulatory effect (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://www.mdpi.com/2071-1050/16/11/4385/pdf (application/pdf)
https://www.mdpi.com/2071-1050/16/11/4385/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:16:y:2024:i:11:p:4385-:d:1399545

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().