Does FDI enhance the effects of heterogeneous environmental regulations on green innovation in China? Evidence from spatial Durbin model analysis

Juntian Wang and Chunyang Wang

Applied Economics Letters, 2025, vol. 32, issue 3, 410-414

Abstract: We explore the effects of voluntary environmental regulation (VER) and mandatory environmental regulation (MER) on green innovation (GI) and further assess the moderating effects of foreign direct investment (FDI). The results indicate that (1) Both VER and MER have positive local and spillover effects on GI. (2) VER can improve GI more effectively than MER. (3) FDI can enhance the effects of both VER and MER on GI. (4) In the long term, VER has positive local and spillover effects on GI, and FDI enhances these relationships.

Date: 2025
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DOI: 10.1080/13504851.2023.2273232

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