Abstract
Previous studies have found that reverse technology spillover effects can promote industrial technology modernization in developing countries. However, it is still unknown whether reverse technology spillover effects can improve green innovation efficiency in developing countries. In particular, institutional uncertainties characteristic of transition economies have a significant impact on industrial modernization. Therefore, researching the impact of the institutional environment on the relationship between reverse technology spillover effects and green innovation efficiency is of great significance. In this paper, we use data from G20 countries as well as China’s foreign direct investment (FDI) data to measure the effects of reverse technology spillovers and adopt the threshold effect model to explore the relationship between reverse technology spillover effects and green innovation efficiency as well as the influence of the institutional environment on this relationship, based on China’s provincial panel data from 2003 to 2015. The empirical results show that the reverse technology spillover effects can effectively improve green innovation efficiency. There is a threshold for the influence of the institutional environment on the relationship between reverse technology spillover effects and green innovation efficiency. When the institutional development level surpasses the threshold value, an acceleration effect is generated. In addition, we find that the legal system is the key bottleneck in terms of improving green innovation efficiency. How to improve and perfect the path of institutional construction in China and how to enable institutions to gain threshold speed-up effects have become the major problems the Chinese government faces in institutional construction. The research results of this paper offer a reference to developing countries in regard to improving their institutions and enhancing their green innovation efficiency.
Highlights
In recent years, outward foreign direct investment (OFDI) originating from developing countries has grown rapidly
This paper mainly studies the impact of the institutional environment on the relationship of reverse technology spillover effect to green innovation efficiency
Unlike previous studies, this paper explores the influence of institutional factors on the relationship between reverse technology spillover effects and green innovation efficiency in uncertain institutional environments based on various regional institutional systems and defines the specific institutional thresholds required for reverse technology spillover effects to generate impacts on green innovation efficiency
Summary
Outward foreign direct investment (OFDI) originating from developing countries has grown rapidly. In developing countries, the institutional uncertainties characteristic of transition economies have a critical impact on green innovation It is of great theoretical and practical significance to explore the impact of reverse technology spillover effects on green innovation efficiency in uncertain institutional environments. Using China’s provincial panel data from 2003 to 2015, this paper uses the threshold effect model to analyze the impact of the legal system, the economic system and the social system on the relationship between reverse technology spillover effects and green innovation efficiency. In an uncertain institutional environment, there is a threshold effect with regard to institutional factors’ impact on the relationship between reverse technology spillover effects and green innovation efficiency. When China’s institutional level is lower than the threshold value, there is no significant difference in the impacts of various institutional factors on the relationship between reverse technology spillover effects and green innovation efficiency. Based on the empirical results, this paper analyzes the advantages and disadvantages of the institutional environment in China and provides a reference for developing countries with respect to improving green innovation efficiency
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