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The Effect of Market-Based Environmental Regulations on Green Technology Innovation—The Regulatory Effect Based on Corporate Social Responsibility

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  • Tao Wei

    (School of Economics and Management, Taiyuan University of Science and Technology, Taiyuan 030024, China)

  • Qinlin Zhu

    (School of Economics and Management, Taiyuan University of Science and Technology, Taiyuan 030024, China)

  • Wenlan Liu

    (The Northern Institute of Scientific and Technological Information (NISTI), Beijing 100080, China)

Abstract

This study explores the impact of market-based environmental regulations on green technological innovation and the differential regulatory effects of corporate social responsibility (CSR) on different levels of green technological innovation. By analyzing data from 746 Chinese A-share listed companies from the period of 2008–2021, this paper examines the effect of market-based environmental regulations on corporate green technology innovation. The research findings are as follows: (1) Market-based environmental regulations have a significant promoting effect on green technology innovation in enterprises. (2) CSR amplifies the positive influence of market-based environmental on green technological innovation, but it has a greater impact on strategic innovations, like utility model patents, rather than substantial ones, like invention patents. Corporate may use CSR to superficially meet regulatory pressures and stakeholder expectations, focusing more on short-term compliance than on long-term sustainable innovation. Companies might utilize CSR as a superficial means to appease regulatory demands, concentrating on immediate compliance rather than fostering enduring innovation. (3) Market-based environmental regulations facilitate green technological innovation by alleviating enterprise financing constraints and improving the efficiency of innovation resource allocation. (4) The promotion effect of market-based environmental regulations on green technological innovation is particularly evident in state-owned enterprises, heavily polluted industries, and regions with high regulatory levels. The research contribution is to provide valuable insights into the implementation of market-based environmental regulations and firms’ green technological innovation. Specifically, it elucidates the nuanced regulatory effects of corporate social responsibility, presenting a fresh lens through which to reconsider the intricate mechanism of CSR’s role as a conduit between environmental policy and innovative practices.

Suggested Citation

  • Tao Wei & Qinlin Zhu & Wenlan Liu, 2024. "The Effect of Market-Based Environmental Regulations on Green Technology Innovation—The Regulatory Effect Based on Corporate Social Responsibility," Sustainability, MDPI, vol. 16(11), pages 1-22, June.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:11:p:4719-:d:1406991
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    References listed on IDEAS

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