Does Environmental Regulation Promote Eco-Innovation Performance of Manufacturing Firms?—Empirical Evidence from China

Jieqiong Wang, Shichao Hu () and Ziyi Zhang
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Jieqiong Wang: Shenzhen Institute of Information Technology, Shenzhen 518000, China
Shichao Hu: School of Accounting, Jiangxi University of Finance and Economics, Nanchang 330013, China
Ziyi Zhang: School of Accounting, Jiangxi University of Finance and Economics, Nanchang 330013, China

Energies, 2023, vol. 16, issue 6, 1-18

Abstract: As the world becomes more concerned about carbon emissions, the Chinese government, which is a large contributor to carbon emissions, has also begun to pay attention to the issue of carbon emissions. Environmental regulatory policies have been implemented to improve the environment, but are these policies really conducive to improving firms’ eco-innovation performance? This paper empirically investigates the relationship between environmental regulation policies and firms’ eco-innovation performance in China and finds that: firstly, environmental regulation in China is inadequate and that manufacturing eco-innovation performance is generally low; secondly, there is a U-shaped relationship between environmental regulation policies and firms’ eco-innovation performance; thirdly, there is significant industry and regional heterogeneity in the induced effects of environmental regulation tools; and fourthly, there is a mediating effect of industrial agglomeration on the promotion of firms’ eco-innovation performance. The conclusions of this paper are: firstly, that the Chinese government should continue to improve environmental regulations and strictly enforce them so that green becomes the colour of ‘economic recovery’; secondly, that the Chinese government should develop scientific and reasonable environmental regulatory policies according to local conditions; thirdly, that Chinese companies should increase their spending on research and development; and fourthly, that the Chinese government needs to optimise the industrial layout and support mechanisms. The Chinese government should play an active role in industrial agglomeration in technological innovation.

Keywords: environmental regulation; manufacturing industry; eco-innovation performance (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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