Facilitation or inhibition? Government environmental attention and corporate green technology innovation

Abstract

Corporate green technology innovation (GTI) is an effective way to solve environmental problems and achieve the goal of sustainable development. It is of great theoretical significance and strategic value to explore the influence of government behavior on corporate GTI. Based on institutional theory and attention theory, this study empirically examines the impact of government environmental attention (GEA) on corporate GTI by using data for China’s A-share listed companies from 2010 to 2021. We find that GEA can significantly promote corporate GTI, and there are four channels of action: strengthening environmental regulatory policies, increasing green investment, strengthening environmental information disclosure, and enhancing corporate social responsibility. Moreover, executive environmental experience, public environmental participation and social media attention positively moderated the impact of GEA on firms’ GTI. Heterogeneity analyses show that these positive effects are more significant in regions with low enforcement intensity, eastern regions, heavily polluted industries and state-owned firms. We also find that GEA can significantly enhance the efficiency and quality of GTI in enterprises, as well as encourage GTI among heavily polluting firms. GTI positively affects enterprise value, total factor productivity, and also improves enterprise environmental performance. Our results provide direct evidence from developing countries that GEA promotes GTI, and also provide theoretical support and decision-making references for further improving environmental policies and achieving sustainable development.