IDEAS home Printed from https://ideas.repec.org/a/gam/jijerp/v20y2023i3p1996-d1043490.html
   My bibliography  Save this article

Environmental Governance Goals of Local Governments and Technological Innovation of Enterprises under Green Performance Assessment

Author

Listed:
  • Xingshuai Wang

    (School of Economics, Shandong University of Technology, Zibo 255000, China)

  • Ehsan Elahi

    (School of Economics, Shandong University of Technology, Zibo 255000, China)

  • Zainab Khalid

    (School of Economics and Management, Southeast University, Nanjing 210096, China)

  • Mohammad Ilyas Abro

    (Department of Basic Sciences and Humanities, Dawood University of Engineering and Technology, Karachi 74800, Sindh, Pakistan)

Abstract

The current study empirically estimates the impact of local government environmental governance on enterprise technological innovation from the perspective of a green political performance assessment of local governments with Chinese characteristics. Fourteen years of data (from 2006 to 2019) on pollutant emissions, and the patents of A-share listed companies were collected from 230 cities in China. A fixed effect model and tool variable method were applied to empirically analyze the objectives of the study. The results show that the environmental governance formulated by the local government has regional differences, which are shown as lower governance indicators for underdeveloped areas and higher governance indicators for developed areas. Environmental governance has a greater promotion effect on technological innovation in enterprises in developed regions, as well as in large and private enterprises. Moreover, mechanism analysis showed that the local governments preferred the path of financial subsidies to promote the level of technological innovation in enterprises. This study provides a foundation for attaining the “win–win” scenario of local government environmental stewardship and high-quality green economic growth.

Suggested Citation

  • Xingshuai Wang & Ehsan Elahi & Zainab Khalid & Mohammad Ilyas Abro, 2023. "Environmental Governance Goals of Local Governments and Technological Innovation of Enterprises under Green Performance Assessment," IJERPH, MDPI, vol. 20(3), pages 1-19, January.
    • Handle: RePEc:gam:jijerp:v:20:y:2023:i:3:p:1996-:d:1043490
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1660-4601/20/3/1996/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1660-4601/20/3/1996/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Paul Lanoie & Michel Patry & Richard Lajeunesse, 2008. "Environmental regulation and productivity: testing the porter hypothesis," Journal of Productivity Analysis, Springer, vol. 30(2), pages 121-128, October.
    2. Peng, Benhong & Chen, Hong & Elahi, Ehsan & Wei, Guo, 2020. "Study on the spatial differentiation of environmental governance performance of Yangtze river urban agglomeration in Jiangsu province of China," Land Use Policy, Elsevier, vol. 99(C).
    3. Nathan Nunn & Nancy Qian, 2014. "US Food Aid and Civil Conflict," American Economic Review, American Economic Association, vol. 104(6), pages 1630-1666, June.
    4. Allen, Franklin & Qian, Jun & Qian, Meijun, 2005. "Law, finance, and economic growth in China," Journal of Financial Economics, Elsevier, vol. 77(1), pages 57-116, July.
    5. Eli Berman & Linda T. M. Bui, 2001. "Environmental Regulation And Productivity: Evidence From Oil Refineries," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 498-510, August.
    6. Gray, Wayne B. & Shadbegian, Ronald J., 2003. "Plant vintage, technology, and environmental regulation," Journal of Environmental Economics and Management, Elsevier, vol. 46(3), pages 384-402, November.
    7. Adam B. Jaffe et al., 1995. "Environmental Regulation and the Competitiveness of U.S. Manufacturing: What Does the Evidence Tell Us?," Journal of Economic Literature, American Economic Association, vol. 33(1), pages 132-163, March.
    8. Kristel Buysse & Alain Verbeke, 2003. "Proactive environmental strategies: a stakeholder management perspective," Strategic Management Journal, Wiley Blackwell, vol. 24(5), pages 453-470, May.
    9. Wagner, Marcus, 2007. "On the relationship between environmental management, environmental innovation and patenting: Evidence from German manufacturing firms," Research Policy, Elsevier, vol. 36(10), pages 1587-1602, December.
    10. Song, Yi & Zhang, Yangxueying & Zhang, Yijun, 2022. "Economic and environmental influences of resource tax: Firm-level evidence from China," Resources Policy, Elsevier, vol. 77(C).
    11. Manuel Frondel & Jens Horbach & Klaus Rennings, 2007. "End‐of‐pipe or cleaner production? An empirical comparison of environmental innovation decisions across OECD countries," Business Strategy and the Environment, Wiley Blackwell, vol. 16(8), pages 571-584, December.
    12. Zhang, Yijun & Song, Yi, 2022. "Tax rebates, technological innovation and sustainable development: Evidence from Chinese micro-level data," Technological Forecasting and Social Change, Elsevier, vol. 176(C).
    13. Yu-Shan Chen & Shyh-Bao Lai & Chao-Tung Wen, 2006. "The Influence of Green Innovation Performance on Corporate Advantage in Taiwan," Journal of Business Ethics, Springer, vol. 67(4), pages 331-339, September.
    14. Giorgio Petroni & Barbara Bigliardi & Francesco Galati, 2019. "Rethinking the Porter Hypothesis: The Underappreciated Importance of Value Appropriation and Pollution Intensity," Review of Policy Research, Policy Studies Organization, vol. 36(1), pages 121-140, January.
    15. Montero, Juan-Pablo, 2002. "Market Structure and Environmental Innovation," Journal of Applied Economics, Universidad del CEMA, vol. 5(2), pages 1-33, November.
    16. Adam B. Jaffe & Karen Palmer, 1997. "Environmental Regulation And Innovation: A Panel Data Study," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 610-619, November.
    17. Elahi, Ehsan & Khalid, Zainab & Zhang, Zhixin, 2022. "Understanding farmers’ intention and willingness to install renewable energy technology: A solution to reduce the environmental emissions of agriculture," Applied Energy, Elsevier, vol. 309(C).
    18. Xingshuai Wang & Ehsan Elahi & Zainab Khalid, 2022. "Do Green Finance Policies Foster Environmental, Social, and Governance Performance of Corporate?," IJERPH, MDPI, vol. 19(22), pages 1-15, November.
    19. Fischer, Carolyn & Parry, Ian W. H. & Pizer, William A., 2003. "Instrument choice for environmental protection when technological innovation is endogenous," Journal of Environmental Economics and Management, Elsevier, vol. 45(3), pages 523-545, May.
    20. Deborah Aiken & Rolf Färe & Shawna Grosskopf & Carl Pasurka, 2009. "Pollution Abatement and Productivity Growth: Evidence from Germany, Japan, the Netherlands, and the United States," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 44(1), pages 11-28, September.
    21. Xiangyang Yang & Zheng Zhang & Siqi Rao & Bei Liu & Yueyue Li, 2022. "How Does Environmental Information Disclosure Affect Pollution Emissions: Firm-Level Evidence from China," IJERPH, MDPI, vol. 19(19), pages 1-20, October.
    22. Elahi, Ehsan & Zhang, Zhixin & Khalid, Zainab & Xu, Haiyun, 2022. "Application of an artificial neural network to optimise energy inputs: An energy- and cost-saving strategy for commercial poultry farms," Energy, Elsevier, vol. 244(PB).
    23. Downing, Paul B. & White, Lawrence J., 1986. "Innovation in pollution control," Journal of Environmental Economics and Management, Elsevier, vol. 13(1), pages 18-29, March.
    24. Lanjouw, Jean Olson & Mody, Ashoka, 1996. "Innovation and the international diffusion of environmentally responsive technology," Research Policy, Elsevier, vol. 25(4), pages 549-571, June.
    25. Elahi, Ehsan & Khalid, Zainab & Tauni, Muhammad Zubair & Zhang, Hongxia & Lirong, Xing, 2022. "Extreme weather events risk to crop-production and the adaptation of innovative management strategies to mitigate the risk: A retrospective survey of rural Punjab, Pakistan," Technovation, Elsevier, vol. 117(C).
    26. Thomas Heberer & Anja Senz, 2011. "Streamlining Local Behaviour Through Communication, Incentives and Control: A Case Study of Local Environmental Policies in China," Journal of Current Chinese Affairs - China aktuell, Institute of Asian Studies, GIGA German Institute of Global and Area Studies, Hamburg, vol. 40(3), pages 77-112.
    27. Slater, Jim & Angel, Isabel Tirado, 2000. "The Impact and Implications of Environmentally Linked Strategies on Competitive Advantage: A Study of Malaysian Companies," Journal of Business Research, Elsevier, vol. 47(1), pages 75-89, January.
    28. Xingshuai Wang & Ehsan Elahi & Lianggui Zhang, 2022. "Mandatory Environmental Regulation and Green Technology Innovation: Evidence from China," Sustainability, MDPI, vol. 14(20), pages 1-13, October.
    29. Juan-Pablo Montero, 2002. "Market Structure and Environmental Innovation," Journal of Applied Economics, Taylor & Francis Journals, vol. 5(2), pages 293-325, November.
    30. Hepei Zhang & Zhangbao Zhong, 2022. "How Does Environmental Regulation Affect the Green Growth of China’s Citrus Industry? The Mediating Role of Technological Innovation," IJERPH, MDPI, vol. 19(20), pages 1-19, October.
    31. Henriques, Irene & Sadorsky, Perry, 1996. "The Determinants of an Environmentally Responsive Firm: An Empirical Approach," Journal of Environmental Economics and Management, Elsevier, vol. 30(3), pages 381-395, May.
    32. Daniel L. Millimet & Santanu Roy & Aditi Sengupta, 2009. "Environmental Regulations and Economic Activity: Influence on Market Structure," Annual Review of Resource Economics, Annual Reviews, vol. 1(1), pages 99-118, September.
    33. Gray, Wayne B, 1987. "The Cost of Regulation: OSHA, EPA and the Productivity Slowdown," American Economic Review, American Economic Association, vol. 77(5), pages 998-1006, December.
    34. Minxin Zuo & Tao Wu, 2022. "Does Environmental Credit Rating Promote Green Innovation in Enterprises? Evidence from Heavy Polluting Listed Companies in China," IJERPH, MDPI, vol. 19(20), pages 1-15, October.
    35. Hamamoto, Mitsutsugu, 2006. "Environmental regulation and the productivity of Japanese manufacturing industries," Resource and Energy Economics, Elsevier, vol. 28(4), pages 299-312, November.
    36. Na Hou & Qianying Zhu & Jinlin Yang & Dahong Zhang & Wenwen Liu & Hong Chang, 2021. "The Impact of Environmental Governance on the Development of Fishery Economy—The Intermediary Role of Technological Innovation," Sustainability, MDPI, vol. 13(20), pages 1-15, October.
    37. Chintrakarn, Pandej, 2008. "Environmental regulation and U.S. states' technical inefficiency," Economics Letters, Elsevier, vol. 100(3), pages 363-365, September.
    38. Elahi, Ehsan & Khalid, Zainab, 2022. "Estimating smart energy inputs packages using hybrid optimisation technique to mitigate environmental emissions of commercial fish farms," Applied Energy, Elsevier, vol. 326(C).
    39. Requate, Till, 2005. "Dynamic incentives by environmental policy instruments--a survey," Ecological Economics, Elsevier, vol. 54(2-3), pages 175-195, August.
    40. Magat, Wesley A., 1978. "Pollution control and technological advance: A dynamic model of the firm," Journal of Environmental Economics and Management, Elsevier, vol. 5(1), pages 1-25, March.
    41. Brunnermeier, Smita B. & Cohen, Mark A., 2003. "Determinants of environmental innovation in US manufacturing industries," Journal of Environmental Economics and Management, Elsevier, vol. 45(2), pages 278-293, March.
    42. Blind, Knut, 2012. "The influence of regulations on innovation: A quantitative assessment for OECD countries," Research Policy, Elsevier, vol. 41(2), pages 391-400.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wang, Kaike & Yin, Ru & He, Qiang & Wang, Shuhong, 2024. "Transfer payments and carbon reduction in China: The effect of the national comprehensive demonstration city of energy saving and emission reduction fiscal policy," Energy, Elsevier, vol. 297(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Xingshuai Wang & Ehsan Elahi & Lianggui Zhang, 2022. "Mandatory Environmental Regulation and Green Technology Innovation: Evidence from China," Sustainability, MDPI, vol. 14(20), pages 1-13, October.
    2. Popp, David & Newell, Richard G. & Jaffe, Adam B., 2010. "Energy, the Environment, and Technological Change," Handbook of the Economics of Innovation, in: Bronwyn H. Hall & Nathan Rosenberg (ed.), Handbook of the Economics of Innovation, edition 1, volume 2, chapter 0, pages 873-937, Elsevier.
    3. Yang, Chih-Hai & Tseng, Yu-Hsuan & Chen, Chiang-Ping, 2012. "Environmental regulations, induced R&D, and productivity: Evidence from Taiwan's manufacturing industries," Resource and Energy Economics, Elsevier, vol. 34(4), pages 514-532.
    4. Felix Groba & Barbara Breitschopf, 2013. "Impact of Renewable Energy Policy and Use on Innovation: A Literature Review," Discussion Papers of DIW Berlin 1318, DIW Berlin, German Institute for Economic Research.
    5. Dietrich Earnhart & Dylan G. Rassier, 2016. "“Effective regulatory stringency” and firms’ profitability: the effects of effluent limits and government monitoring," Journal of Regulatory Economics, Springer, vol. 50(2), pages 111-145, October.
    6. Rubashkina, Yana & Galeotti, Marzio & Verdolini, Elena, 2015. "Environmental regulation and competitiveness: Empirical evidence on the Porter Hypothesis from European manufacturing sectors," Energy Policy, Elsevier, vol. 83(C), pages 288-300.
    7. Böhringer, Christoph & Moslener, Ulf & Oberndorfer, Ulrich & Ziegler, Andreas, 2012. "Clean and productive? Empirical evidence from the German manufacturing industry," Research Policy, Elsevier, vol. 41(2), pages 442-451.
    8. Adam Jaffe & Richard Newell & Robert Stavins, 2002. "Environmental Policy and Technological Change," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 22(1), pages 41-70, June.
    9. Lorena D’Agostino, 2015. "How MNEs respond to environmental regulation: integrating the Porter hypothesis and the pollution haven hypothesis," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 32(2), pages 245-269, August.
    10. Stefan Ambec & Mark A. Cohen & Stewart Elgie & Paul Lanoie, 2013. "The Porter Hypothesis at 20: Can Environmental Regulation Enhance Innovation and Competitiveness?," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 7(1), pages 2-22, January.
    11. Ming Yi & Xiaomeng Fang & Le Wen & Fengtao Guang & Yao Zhang, 2019. "The Heterogeneous Effects of Different Environmental Policy Instruments on Green Technology Innovation," IJERPH, MDPI, vol. 16(23), pages 1-19, November.
    12. Yao, Shiyue & Yu, Xueying & Yan, Sen & Wen, Shiyan, 2021. "Heterogeneous emission trading schemes and green innovation," Energy Policy, Elsevier, vol. 155(C).
    13. Wu, Haitao & Hao, Yu & Ren, Siyu, 2020. "How do environmental regulation and environmental decentralization affect green total factor energy efficiency: Evidence from China," Energy Economics, Elsevier, vol. 91(C).
    14. Stavins, Robert & Jaffe, Adam & Newell, Richard, 2000. "Technological Change and the Environment," Working Paper Series rwp00-002, Harvard University, John F. Kennedy School of Government.
    15. He, Yiqing & Ding, Xin & Yang, Chuchu, 2021. "Do environmental regulations and financial constraints stimulate corporate technological innovation? Evidence from China," Journal of Asian Economics, Elsevier, vol. 72(C).
    16. Roberto Antonietti & Alberto Marzucchi, 2013. "Green Investment Strategies and Export Performance: A Firm-level Investigation," Working Papers 2013.76, Fondazione Eni Enrico Mattei.
    17. Johan Brolund & Robert Lundmark, 2017. "Effect of Environmental Regulation Stringency on the Pulp and Paper Industry," Sustainability, MDPI, vol. 9(12), pages 1-16, December.
    18. Xie, Rong-hui & Yuan, Yi-jun & Huang, Jing-jing, 2017. "Different Types of Environmental Regulations and Heterogeneous Influence on “Green” Productivity: Evidence from China," Ecological Economics, Elsevier, vol. 132(C), pages 104-112.
    19. Martínez-Zarzoso, Inmaculada & Bengochea-Morancho, Aurelia & Morales-Lage, Rafael, 2019. "Does environmental policy stringency foster innovation and productivity in OECD countries?," Energy Policy, Elsevier, vol. 134(C).
    20. Wang, Yan & Shen, Neng, 2016. "Environmental regulation and environmental productivity: The case of China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 62(C), pages 758-766.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jijerp:v:20:y:2023:i:3:p:1996-:d:1043490. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.