Does environmental regulation enhance servitization in aspirant markets? Evidence from China's manufacturing sector

Feng Zhang, Xile Yin, Haina Zhang and Xiangcen Zhan

Technovation, 2024, vol. 131, issue C

Abstract: In contrast to prior studies that focus on the product or technological dimension of environmental innovation, this study broadens the scope of environmental innovation to the business model innovation of servitization. It investigates the exogenous shock of environmental policy on the servitization of manufacturing firms in the specific context of aspirant markets such as China. By employing the difference-in-differences (DID) method, this study finds that manufacturing firms in regulated sectors are more likely to develop services than those in non-regulated sectors. However, manufacturing firms prefer to develop basic rather than advanced services. Additionally, resource slack positively moderates the effects of environmental regulations on servitization. This study provides policy and managerial implications concerning environmental regulations on manufacturing firms’ adoption of service-related environmental innovations.

Keywords: Environmental innovation; Environmental regulations; Resource slack; Servitization (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:techno:v:131:y:2024:i:c:s0166497224000026

DOI: 10.1016/j.technovation.2024.102952

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