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Unleashing the impact of ecological civilization pilot policies on green technology innovation: Evidence from a novel SC-DID model

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  • Bai, Dongbei
  • Hu, Jin
  • Irfan, Muhammad
  • Hu, Mingjun

Abstract

Green technology innovation (GTI) is the main force behind green development and is crucial to developing countries' economic growth. Strengthening green technology innovation has become an inevitable choice for the development of global society. However, formal environmental regulations often require high implementation costs. Therefore, informal environmental regulations, such as ecological civilization pilots (ECP), have received widespread attention. Previous research methods have difficulty accurately identifying the impact of ecological civilization pilots on green technology innovation, while the new synthetic control difference-in-differences model (SC-DID) method can effectively fill this methodological gap. Based on the SC-DID and using green patent data, we empirically tested the impact of the ECP on GTI in the pilot provinces. We found that ECP significantly promotes GTI in the pilot provinces, and the findings were still robust after the placebo test. ECP promotes both ‘strategic’ and ‘substantive’ innovation in green technology. In particular, the number of green utility model patents (GUP) in the pilot provinces increased by 38.1% on average following the implementation of the ECP, whereas the number of green invention patents (GIP) only increased by 23.1%. Further, we also made a back-of-the-envelope calculation of the policy cost and the benefits brought by GTI. Six years after implementing ECP, the net benefit was about 16.78 billion yuan. This paper uses a relatively novel and robust research method, SC-DID, to enrich the research on the policy effects of ECP. The research findings from our study conducted in China can provide a reference for developing countries, supporting their green and economic development.

Suggested Citation

  • Bai, Dongbei & Hu, Jin & Irfan, Muhammad & Hu, Mingjun, 2023. "Unleashing the impact of ecological civilization pilot policies on green technology innovation: Evidence from a novel SC-DID model," Energy Economics, Elsevier, vol. 125(C).
    • Handle: RePEc:eee:eneeco:v:125:y:2023:i:c:s0140988323003110
    DOI: 10.1016/j.eneco.2023.106813
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