Abstract
One of the main purposes of the 2015 Environmental Protection Law (EPL) of the People's Republic of China is to boost the green innovation of the enterprises. Using heavy-polluting enterprises as examples, this paper uses the Difference-in-difference analysis (DDD) technique to analyze the influence of EPL on the green innovation of enterprises under fiscal decentralization and enterprise heterogeneity. Results show that EPL exerts a negative impact on the green innovation of heavy-polluting enterprises at the national level, as well as those in the central and western areas specifically. The only presence of positive motivation for green innovation is being found in the eastern area, although, the motivation seems to be insignificant. The negative impacts have been lasting in the long run, especially for the low-performance enterprises in the central areas. As for the targeted implementation of EPL in China, local governments should make the best use of financial power under fiscal decentralization. This balanced approach is designed to motivate enterprises in different regions with various performance levels to develop green innovation based on their different weaknesses and strengths.
Highlights
Since its reform and opening up, rapid economic development has been experienced in China, but the task of conserving energy and reducing emissions has been unyielding
Green innovation and other forms of innovation are always affected by many factors like region, industry, market environment, and the political public environment, so a comparison analysis was made between the treatment and control groups based on changes in enterprise performance and innovation before and after enrolling in the Environmental Protection Law (EPL) (SC-12th NPR, 2015)
The results found in the central and western areas are in accordance with the DDD results at the national level
Summary
Since its reform and opening up, rapid economic development has been experienced in China, but the task of conserving energy and reducing emissions has been unyielding. The Environmental Protection Law (EPL) of the People’s Republic of China (Standing Committee of Twelfth National People’s Congress of the People’s Republic of China, 2015), January 1, 2015, was declared to establish and advocate coordination between economic development and environmental protection. When compared to the former law, the number of articles in the EPL (SC-12th NPR, 2015) increased to 70, with larger environmental obligations and harsher punishments for polluting enterprises. The EPL (SC-12th NPR, 2015) clearly stipulates that pollutant-discharging enterprises and other operators shall take measures to prevent and control pollution and hazards such as waste gas, wastewater, waste residue, medical waste, dust, malodorous gas, and radioactive substances produced during production or other activities
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
