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Green fiscal policy and enterprise green innovation: evidence from quasi-natural experiment of China

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Abstract

We aim to study the impact of green fiscal policy on enterprise green innovation by applying a time-varying difference-in-difference (DID) model, and treat the comprehensive demonstration city of fiscal policy for energy conservation and emission reduction (CPEE) in China as a quasi-natural experiment. The results show that the CPEE can significantly improve enterprise’s green innovation performance of pilot area. This net policy effect is valid after a series of robustness tests to control for various potential confounding factors. Heterogeneity analysis reveals that the effect of CPEE is stronger for state-owned enterprises and enterprises in high energy consumption industries or industries with higher industrial concentration. In addition, the effect of CPEE is various among different categories of green patents, which is stronger for the types of alternative energy production category, waste management category, administrative supervision and design category. The mechanism test indicates that the CPEE can improve the green innovation performance by increasing enterprise’ investment in research and development, promoting territorial industrial transformation and upgrading, and enhancing enterprise executives’ environmental awareness. To achieve the carbon peaking and carbon neutrality goals, the green enabling role of fiscal reform pilot policy in transition economies and the applicability of localized policies should be excavated.

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Funding

This research work is supported in part by grants from the 2022 Annual Program of Philosophy and Social Sciences Planning of Guangdong Province (GD22YYJ16), the 2022 Project of the 14th Five Year Plan for the Development of Philosophy and Social Sciences in Guangzhou (2022GZQN06), Guangdong Provincial Financial Research Project “Research on the Connection of Guangdong-Hong Kong-Macao’s Financial and Tax Systems” (2023GDCZ017), Key Topics of Foshan Social Science Planning “Creating a First-class Business Environment and Implementing Precise Investment Attraction in the Industrial Chain” (2023-ZDB02) and “Promoting the Stable Scale and Optimal Structure of Foshan’s Foreign Trade” (2023-ZDB05), Guangdong Province Innovation Training Project “Spatial Layout of Digital Service Industry and Upgrading of China’s Manufacturing Value Chain: Coordination or Disharmony”.

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Authors and Affiliations

  1. Institute of Studies for the Greater Bay Area & Key Laboratory for Construction and Regional Coordinated Development in the Greater Bay Area, Guangdong University of Foreign Studies, Guangzhou City, 510006, Guangdong Province, People’s Republic of China

    Sheng Liu

  2. School of Mathematics and Statistics, Guangdong University of Foreign Studies, Guangzhou City, 510006, Guangdong Province, People’s Republic of China

    Peijin Xu

  3. School of Economics and Trade, Guangdong University of Finance, Guangzhou City, 510521, Guangdong Province, People’s Republic of China

    Xiuying Chen

Authors
  1. Sheng Liu
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  2. Peijin Xu
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Contributions

The authors confirm contribution to the paper as follows: conceptualization, S.L., P.J.X., and X.C.; methodology, P.J.X, S.L.; software, P.J.X; formal analysis, S.L., P.J.X. and X.C.; investigation, S.L., P.J.X. and X.C.; writing—original draft preparation, H.Z., S.L.; writing—review and editing, S.L., P.J.X. and X.C.; visualization, P.J.X.; supervision, S.L., P.J.X.; funding acquisition, S.L.. All authors have read and agreed to the published version of the manuscript.

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Correspondence to Xiuying Chen.

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Liu, ., Xu, P. & Chen, X. Green fiscal policy and enterprise green innovation: evidence from quasi-natural experiment of China. Environ Sci Pollut Res 30, 94576–94593 (2023). https://doi.org/10.1007/s11356-023-28847-5

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  • DOI: https://doi.org/10.1007/s11356-023-28847-5

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