The nexus between green innovations and natural resources commodity prices in China

Abstract

The present study aimed to expansively evaluate the association between the green innovations and the natural resource commodity prices in China. China has been focusing on green policy implementations and green innovation for development of a green economy, however, it is integral to evaluate the impact of these considerations on the natural resource commodity prices. Thus, the paper evaluates the impact of the green innovation on the natural resource commodity prices within China. The research is based on data from 30 eastern, western, and central Chinese provinces for the period 2002–2020. The paper provides a measurement method for green innovation through the number of the “alternative energy production and energy conservation patents”. The overall number of patent applications and the number of grants issued for the patents were taken as indicators for the green innovation. The results indicated that there is a positive impact of the green innovation measures on the natural resource commodity prices. Although, when the sample is evaluated based on regional differences, there is presence of heterogeneity related to the impact of the green innovation on the natural resource commodity prices. Explicitly, green innovation has a specific role in the promotion and influence of the commodity prices in the western and central Chinese regions whereas it posits no influence in the eastern regions.