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Can energy efficiency credit guidelines boost enterprises' low-carbon technological innovation? Evidence from China

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  • Jin, Jian
  • Xu, Su
  • Gao, Bei

Abstract

This research takes China's “Energy Efficiency Credit Guidelines (EECG)” as a quasi-natural experiment and uses the propensity score matching-difference-in-differences (PSM-DID) method to examine the impact of incentive-based energy efficiency credit policies on corporate low-carbon technological innovation. The research finds that the EECG have exerted a positive incentive effect, promoted corporate low-carbon technological innovation and showed a trend of “improving quantity and increasing quality.” Mechanism analysis shows that the EECG mainly incentivize low-carbon technological innovation by promoting financing competition among firms, inhibiting corporate financialization, attracting green investors, and strengthening firms' awareness of climate risks. Moderating effect analysis reveals that climate policy uncertainty has an inverted U-shaped moderating effect on the policy effectiveness of the EECG. Heterogeneity analysis indicates that the innovation incentive effect of energy efficiency credit is stronger in firms with executives having environmental backgrounds, technology-intensive firms, and firms located in regions with lower levels of informal financial development. Finally, the promotion of low-carbon technological innovation by the EECG further optimizes firms' ESG (environmental, social, and governance) performance.

Suggested Citation

  • Jin, Jian & Xu, Su & Gao, Bei, 2025. "Can energy efficiency credit guidelines boost enterprises' low-carbon technological innovation? Evidence from China," Energy Economics, Elsevier, vol. 150(C).
    • Handle: RePEc:eee:eneeco:v:150:y:2025:i:c:s0140988325006826
    DOI: 10.1016/j.eneco.2025.108855
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    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation

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