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Does green credit policy matter for corporate sustainable innovation? Evidence from China

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  • Li, Tingting
  • Meng, Xiangrui
  • Wang, Weiqing
  • Yang, Deyong
  • Nie, Mengxun
  • Zhang, Qingyu

Abstract

Green finance is a powerful motivator for promoting sustainable innovation and achieving green development. Under the dual background of building a green finance system and a market-oriented green technology innovation system, this study examines the impact of the Green Credit Guidelines on the sustainable innovation of enterprises both before and after implementation. By analyzing the propensity score matching difference-in-difference (PSM-DiD) analysis of Chinese listed enterprises, we have found that the support of relevant policies actually inhibits sustainable innovation and reduces the number of sustainability-related patents. This effect is more pronounced in green credit-restricted industries, state-owned enterprises (SOEs), and eastern regions. Ultimately, we have discovered that green utility model patents, in contrast to green invention patents, are the primary indicator of the detrimental impact of green credit policy on the performance of sustainable innovation. Overall, our study broadens the understanding of the external impacts of sustainable innovation within enterprises and provides valuable insights for corporate policy makers and management professionals.

Suggested Citation

  • Li, Tingting & Meng, Xiangrui & Wang, Weiqing & Yang, Deyong & Nie, Mengxun & Zhang, Qingyu, 2024. "Does green credit policy matter for corporate sustainable innovation? Evidence from China," Economic Analysis and Policy, Elsevier, vol. 84(C), pages 1788-1806.
    • Handle: RePEc:eee:ecanpo:v:84:y:2024:i:c:p:1788-1806
    DOI: 10.1016/j.eap.2024.11.002
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