Environmental Regulation, Two-Way Foreign Direct Investment, and Green Innovation Efficiency in China’s Manufacturing Industry

Zhao, Feng; Zeng, Bo; Ming, Qian

doi:10.3390/ijerph15102292

Cited by 92 publications

(59 citation statements)

References 61 publications

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“…Firstly, on the basis of the results above, the introduction of foreign direct investment contributes to the improvement of the RCA based on export value added. Similarly, Feng et al [59] confirm that the two-way foreign direct investment is significantly beneficial to the green innovation efficiency of China's manufacturing industry. Therefore, we believe that the extroversion and internationalization of China's manufacturing industry, together with bilateral investment agreements in an international context, can favor the export competitiveness of industrial enterprises through environmentally friendly production processes.…”

Section: Discussionmentioning

confidence: 91%

Environmental Regulation, Technological Innovation, and Export Competitiveness: An Empirical Study Based on China’s Manufacturing Industry

Liu

Xie

2020

IJERPH

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A current and universal challenge, particularly in developing nations, is the establishment of effective environmental regulation policies that protect the ecological environment without adversely affecting the international competitiveness of the domestic manufacturing industry. To deal with this dilemma, this study investigates the export competitiveness of China’s manufacturing industry from the viewpoint of export value added. The Porter hypothesis is applied for an empirical investigation of the effect of environmental regulation on export competitiveness and to determine the presence of intra-industry heterogeneity. Furthermore, this study seeks to understand the mechanisms through which environmental regulation affects export competitiveness by exploring the two main approaches to technological innovation. The findings reveal that environmental regulation has a promotion effect of approximately 2% on the export competitiveness of China’s manufacturing industry; however, this effect is non-linear and displays a “U-shaped” tendency, indicating that certain prerequisites must be fulfilled to validate the Porter hypothesis. In addition, the effect of environmental regulation displays significant intra-industry heterogeneity, which is evident primarily in heavily polluting sub-industries and to a lesser extent in moderately polluting sub-industries but insignificant in lightly polluting sub-industries. Environmental regulation also differs significantly in the mechanisms through which it affects different approaches to technological innovation. Independent research and development is affected by environmental regulation through the compliance cost effect, which limits export competitiveness, while technology introduction is affected by the innovation offset effect, which favors export competitiveness. These findings offer political implications for the sustainable development of the ecological environment and foreign trade.

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Section: Discussionmentioning

confidence: 91%

Environmental Regulation, Technological Innovation, and Export Competitiveness: An Empirical Study Based on China’s Manufacturing Industry

Liu

Xie

2020

IJERPH

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“…Environmentally friendly products produced by eco-innovation can lend firms a competitive edge and thus improve firm's business performance [51]. Finally, EREG can keep firms that do not meet emission standards from entering the market through raising the entry criteria, e.g., raising pollutants emission standards, energy use standards, and energy efficiency standards [49,52]. In this way, EREG can optimize the market structure, reduce intensive competition, and increase firms' market share, thus contributing to the improvement of firm performance.…”

Section: Direct Effects Of Eregmentioning

confidence: 99%

Environmental Regulation, Environmental Commitment, Sustainability Exploration/Exploitation Innovation, and Firm Sustainable Development

et al. 2019

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The links among firms’ environmental regulation, innovation process, and sustainable development has been analyzed, but a research gap still remains in terms of environmental commitment and different types of sustainable innovation in firms’ sustainability. Through collecting a dataset of 380 valid respondents from Chinese manufacturing firms, this paper incorporates evironmental regulation, environmental commitment, sustainability exploration innovation, sustainability exploitation innovation, environmental performance, and business performance into a multiple mediating effect model. Our key emperical findings are as follows: (1) Environmental regulation not only cannot affect environmental performance and business performance, but also cannot affect the two types of firm performance through sustainability exploration innovation or sustainability exploitation innovation; (2) The relationship between environmental regulation, environmental performance (or business performance) is subsequently mediated by both environmental commitment and sustainability exploitation innovation; (3) Environmental regulation does not affect environmental performance (or business performance) through environmental commitment and sustainability exploration innovation. These results do, however, support the Porter Hypothesis in terms of revealing a new multiple mediating effect path dominated by environmental commitment and sustainability exploitation innovation. Our findings can provide a better understanding of how environmental commitment and sustainability exploitation innovation play a key effect in helping firms relieve the pressure from environmental regulation, and thus improve their environmental management while keeping their competitive edge.

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“…When scholars examine the effects of ERs on TI, they also use the newly developed methodologies to evaluate the efficiency of TI. Feng et al [16] measure the efficiency of green innovation via super-slack-based measure and demonstrate that the influence of ERs on the efficiency of green innovation is significantly negative. Zhu et al [15] construct a game cross-efficiency model to measure technological innovation efficiency and indicate that the effect of mandatory regulation on technological innovation efficiency turns out to be insignificant, whereas voluntary regulation has positive effects at the provincial level.…”

Section: Applications Of Dea When Investigating the Impacts Of Enviromentioning

confidence: 99%

“…The impacts of ERs on TI have been widely studied for several decades [14,15], and diverse resulting relationships (e.g., positive, negative, neutral and nonlinear) have been found [14,[16][17][18]. In this paper, we also analyze the impacts of ERs on TI in the Chinese context, but there are several differences compared to prior studies.…”

Section: Introductionmentioning

confidence: 98%

Opening the Black Box: The Impacts of Environmental Regulations on Technological Innovation

Zhang

Ramanathan

et al. 2020

IJERPH

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Environmental regulations (ERs) that can stimulate technological innovation (TI) are the key to enabling a win-win strategy that benefits both economic development and environmental protection. This study seeks to analyze the impacts of ERs on TI. Previous literature highlighted that the black box of TI can be decomposed into technology investment and technology transformation, but empirical studies on such a decomposition have largely been ignored. Moreover, a detailed discussion of the links between ERs and the decomposed components of TI has not been conducted in developing countries such as China. Our study attempts to address these research gaps by (i) decomposing TI using a novel data envelopment analysis (DEA) procedure and further analyzing the impacts of ERs on the decomposed components of TI and (ii) applying this novel methodology to Chinese context. Accordingly, this study is conducted in two stages. First, a novel application of the slack-based measure Network DEA model is developed to uncover the black box of TI using Chinese data in order to estimate the overall efficiency of technological innovation (TIE) and to decompose it into the efficiency of technology investment (TVE) and the efficiency of technology transformation (TTE). Second, a random effect Tobit model is applied to (i) investigate both the linear and nonlinear impacts of ERs on TIE in all sectors and (ii) examine whether the impacts of ERs on TVE and TTE in different subprocesses are heterogeneous or not. Our results have showed the benefits of decomposing TI: while technology transformation in China closely follows the trend of TI, the trend of technology investment is somewhat different. The estimation results further indicate that the impacts of ERs on TIE are nonlinear. Besides, ERs have heterogeneous impacts on the decomposed components of TI. The impacts of ERs on TVE are nonlinear, whereas the impacts of ERs on TTE are statistically insignificant.

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Environmental Regulation, Two-Way Foreign Direct Investment, and Green Innovation Efficiency in China’s Manufacturing Industry

Cited by 92 publications

References 61 publications

Environmental Regulation, Technological Innovation, and Export Competitiveness: An Empirical Study Based on China’s Manufacturing Industry

Environmental Regulation, Technological Innovation, and Export Competitiveness: An Empirical Study Based on China’s Manufacturing Industry

Environmental Regulation, Environmental Commitment, Sustainability Exploration/Exploitation Innovation, and Firm Sustainable Development

Opening the Black Box: The Impacts of Environmental Regulations on Technological Innovation

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