Can China’s national Five-Year Plan for environmental protection induce corporate green innovations?

Lu, Huixin; Wang, Shi

Can China’s national Five-Year Plan for environmental protection induce corporate green innovations?

2022

Lu, Huixin | Wang, Shi

This study investigates the effect of China’s national Five-Year Plan for environmental protection (FYPEP) on corporate green innovations based on the two-way fixed effect model and panel data about the green patents of China’s publicly listed corporations during 1990–2020. Furthermore, the heterogeneity of these green innovations is further discussed with reference to the types of innovation, enterprise ownership, and the location of the corporations. It is found that FYPEP significantly induced corporation green innovations at regional and industrial levels. Heterogeneity analysis indicates that the inductive effect of FYPEP is stronger on green utility model patents than on green invention patents. State-owned enterprises react to green innovation policies more significantly than do private businesses. The inductive effect of FYPEP is stronger in Eastern China than in mid- and Western China. From the perspective of government intervention, this research renders a new framework for the formulation of policies of national environmental protection and corporate green innovation.

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