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Better green financial instrument: Government green fund and corporate new energy technology innovation

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  • Zheng, Zhuoji
  • Li, Xueqin
  • Han, Xianfeng
  • Shi, Daqian
  • Liu, Juan

Abstract

Previous literature mostly discusses debt-based green financial instruments like green credit and green bond, ignoring the key role of the government green fund (GGF), an important equity-based financing tool, in promoting corporate new energy technology innovation (NETI). This study employs panel data from Chinese A-share listed companies from 2010 to 2022 to empirically examine the impact of GGF on NETI. The results indicate that, following the GGF investment, the number of patent applications for corporate new energy technology significantly increases, suggesting that the GGF can effectively promote corporate NETI. Mechanism analysis reveals that the GGF influences corporate NETI through two pathways: the transformation of external financing model and the allocation of internal R&D resources. Heterogeneity analysis shows that the incentive effect of GGF is more pronounced in corporations with lower institutional shareholding ratios and in regions with more abundant venture capital resources. Additionally, the GGF has achieved better outcomes in promoting NETI in fields such as solar energy, biomass energy, and smart grids. The findings of this study offer policy recommendations for government investment in scientific green investment and the advancement of China's green financial market.

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  • Zheng, Zhuoji & Li, Xueqin & Han, Xianfeng & Shi, Daqian & Liu, Juan, 2025. "Better green financial instrument: Government green fund and corporate new energy technology innovation," Energy Economics, Elsevier, vol. 143(C).
    • Handle: RePEc:eee:eneeco:v:143:y:2025:i:c:s014098832500057x
    DOI: 10.1016/j.eneco.2025.108234
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