Does Environmental Regulation Promote Environmental Innovation? An Empirical Study of Cities in China.

Dezhong Duan,Qifan Xia

doi:10.3390/ijerph19010139

Abstract

Promoting environmental innovation through environmental regulation is a key measure for cities to reduce environmental pressure; however, the role of environmental regulation in environmental innovation is controversial. This study used the number of environmental patent applications to measure urban environmental innovation and analyzed the role of urban environmental regulation on urban environmental innovation with the help of the spatial Durbin model (SDM). The results showed that: (1) From 2007 to 2017, the number of environmental patent applications in China has grown rapidly, and technologies related to buildings dominated the development of China’s environmental innovation. (2) Although the number of cities participating in environmental innovation was increasing, China’s environmental innovation activities were highly concentrated in a few cities (Beijing, Shenzhen, and Shanghai), showing significant spatial correlation and spatial agglomeration characteristics. (3) Urban environmental regulation had a positive U-shaped relationship with urban environmental innovation capability, which was consistent with what the Porter hypothesis advocates.

Highlights

IntroductionThe urban environment is a major contributor to climate change, mainly due to its high dependence on natural resources [1]; cities can be key players in combating climate change by addressing environmental sustainability actions (e.g., formulating pollution discharge standards, collecting pollution taxes, granting emission reduction subsidies, issuing pollution permits, etc.) to encourage enterprises to carry out environmental innovation in order to reduce emissions [2]
The urban environment is a major contributor to climate change, mainly due to its high dependence on natural resources [1]; cities can be key players in combating climate change by addressing environmental sustainability actions to encourage enterprises to carry out environmental innovation in order to reduce emissions [2]
From 2007 to 2017, the number of cities participating in environmental innovation in China increased from 330 in 2007 to 338 in 2017, among which the number of cities engaging in innovation around building technology was always the largest, while the number of cities engaging in innovation around greenhouse gas technology was always the smallest

Summary

Introduction

The urban environment is a major contributor to climate change, mainly due to its high dependence on natural resources [1]; cities can be key players in combating climate change by addressing environmental sustainability actions (e.g., formulating pollution discharge standards, collecting pollution taxes, granting emission reduction subsidies, issuing pollution permits, etc.) to encourage enterprises to carry out environmental innovation in order to reduce emissions [2]. It is undeniable that the Chinese government attaches increasing importance to environmental protection, and increasingly strict environmental regulations are constantly being implemented in China [4]. The realization of strong decoupling between urban economic growth and environmental degradation crucially depends on technological improvements, which is environmental innovation. Since environmental innovation puts more emphasis on production and output [5,6], research on environmental innovation

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