Abstract
Green Technology innovation intends to enable the advancement of technologies toward the goals of human health, natural resource sustainability and social equity. Green technology innovation has become an important driving force for the sustainable growth of the global economy. In this study, building upon the theories on informal institutions, we empirically investigate the effects of social trust on green technology innovation. Using a sample of companies listed in A-share markets in China from 2012 to 2017, we find that social trust has a significant positive impact on the performance of green technology innovation. We employ an instrumental variable approach through two-stage-least square estimator, and report consistent results. Further heterogeneity analysis finds that with higher levels of policy uncertainty and lower levels of intellectual property rights protection, the effect of social trust on firms’ green technology innovation is more significant. Further, the effect of social trust on firms’ green technology of non-SOEs innovation is larger than SOEs. In addition, the positive effect of social trust on green technology innovation in firms is an effective supplement for formal systems to promote green technology innovation in said firms, which provides a new theoretical reference for promoting firms’ green technology innovation and achieving high-quality development.
Highlights
The existing research mainly explores the important influence of formal systems on green technology innovation in firms, but discussing the relationship between informal systems and green technology innovation in firms is not enough, especially given the influence of social trust, an important informal institutional factor
Based on the perspective of informal institutions, this paper empirically tests the influence of the micro-mechanism of social trust on green technology innovation in Chinese A-share listed companies from 2012 to 2017 and further discusses the effects of economic policy uncertainty, intellectual property rights protection, and property rights on the results
Social trust has an incentive effect on green technology innovation in firms; that is, the better the social trust is, the higher the input and patent output level of green technology innovation in firms is, which shows that a good level of social trust helps to reduce the negative externality of green technology innovation in firms’ activities and enhances the willingness of firms to engage in green technology innovation activities
Summary
Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affiliations. Since the reform and opening up of China 40 years ago, China’s factor-driven development model has promoted rapid economic growth, and brought about a huge environmental cost. In the event of a growth model that produces haze, groundwater pollution, and other adverse events, the cost to the environment is bound to be unsustainable over a long period of time and cannot meet the new requirements of high-quality development. Under the new economic normal, it has become an inevitable choice, in order to achieve high-quality economic development in China, to change the mode of development, taking into account the dual goals of environmental protection and economic development, and guide economic growth toward a green, efficient, and sustainable innovation-driven mode.
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