How does environmental regulation promote technological innovations in the industrial sector? Evidence from Chinese provincial panel data

Promoting technological innovations by environmental regulation is one of the essential means to achieve green transformation. This study investigates the effect of environmental regulation on technological innovations based on the provincial panel data of industrial sectors in China during the year...

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Veröffentlicht in:Energy policy Jg. 139; S. 111310
Hauptverfasser: Ouyang, Xiaoling, Li, Qiong, Du, Kerui
Format: Journal Article
Sprache:Englisch
Veröffentlicht: Kidlington Elsevier Ltd 01.04.2020
Elsevier Science Ltd
Schlagworte:
business enterprises
Capital investments
China
Compensation
economic investment
Emissions control
Energy conservation
energy costs
Energy policy
Environmental effects
environmental law
Environmental policy
Environmental protection
Environmental regulation
Environmental regulations
FDI
Foreign capital
Foreign investment
Human capital
Industry
Innovations
Investments
issues and policy
Longitudinal studies
market competition
Ownership structure
Panel data
Pollution control
Production capacity
Public enterprise
public ownership
Regulation
Technological change
Technological innovations
technology
Transformation
China
FDI
Technological innovations
Ownership structure
Environmental regulation
ISSN:0301-4215, 1873-6777
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Zusammenfassung:Promoting technological innovations by environmental regulation is one of the essential means to achieve green transformation. This study investigates the effect of environmental regulation on technological innovations based on the provincial panel data of industrial sectors in China during the years 2005–2015. The two-way fixed-effect panel data model is used to investigate the marginal and heterogeneous impacts empirically. Results indicate a U-shaped relationship between environmental regulation and technological innovations. In the short-term, environmental regulation has an “offsetting effect” on the research and innovation capacity of China's industrial sector. However, with the deepening of environmental regulation, it forces the industry to reduce the cost of pollution control by improving technological innovation capacity, thus creating a “compensation effect”. Results also show that environmental regulation policies changed the location and industry selection of foreign capital, which weakened the positive effect of FDI on technological innovations, indicating the “pollution shelter” effect. From the perspective of different types of enterprises, due to the higher cost of energy conservation and emission reduction, environmental regulation is detrimental to the technological innovations of state-owned enterprises. In particular, we find that industries with a higher degree of market competition and higher human capital investment tend to have stronger technological innovation capabilities. •There is a U-shaped relationship between environmental regulation and technological innovations.•FDI and market competition promotes technological innovations.•Environmental regulation has heterogeneous impacts on technological innovation.
Bibliographie:ObjectType-Article-1
SourceType-Scholarly Journals-1
ObjectType-Feature-2
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ISSN:0301-4215
1873-6777
DOI:10.1016/j.enpol.2020.111310