Journal
ECONOMICS LETTERS
Volume 190, Issue -, Pages -Publisher
ELSEVIER SCIENCE SA
DOI: 10.1016/j.econlet.2020.109090
Keywords
Environmental regulation; Eco-innovation; Green patents; Difference-in-differences
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Funding
- Youth Project of the National Social Science Foundation of China [15CJL052]
- Major Project of Ministry of Education of China, Humanities and Social Sciences Key Research Base [16JJD790036]
- Fundamental Research Funds for the Central Universities Social Science Innovation Team of Xiamen University [20720171001]
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Using the variation in pollution reduction targets across provinces and time variations (before and after the eleventh Five-Year Plan), we examine the impact of stricter environmental regulation upon the production of green patents by firms in China. We find that Chinese manufacturing firms, located in provinces with stricter pollution targets, produced a higher volume and intensity of green patents. Our results suggest that stricter environmental regulatory frameworks in emerging economies are not only combating pollution, but also shifting the innovation activities of manufacturing firms towards building a stock of knowledge in environmental protection. This process, undoubtedly, has the potential to generate disruptive eco-innovations. (c) 2020 Elsevier B.V. All rights reserved.
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