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Beyond the linear: Green technology innovation, moderators, and global value chain upgrading

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  • Duan, Jihong
  • Li, Yan
  • Shi, Wenming
  • Wu, Kaiyao

Abstract

This study examines the non-linear impact of green technology innovation (GTI) on the global value chain (GVC) position of China's manufacturing industry. To this end, the moderating roles of environmental regulation and absorptive capacity are considered. Using innovative indicators based on Patent Cooperation Treaty data for the GTI and Wang-Wei-Yu-Zhu-Koopman-Wang-Wei framework for the GVC position, this study analyzes data from the Organization for Economic Co-operation and Development (2004–2018) and Asian Development Bank (2019–2023). The study finds that while GTI positively impacted GVC upgrading pre-2018, this effect reversed post-2018. The moderation analysis further reveals that the inverted U-shaped effect of environmental regulation weakened after 2018, whereas the positive linear moderating effect of absorptive capacity reversed entirely. These results highlight the critical influence of industry heterogeneity and contextual factors, demonstrating the need for resilience-focused policies to navigate the evolving GTI-GVC relationship.

Suggested Citation

  • Duan, Jihong & Li, Yan & Shi, Wenming & Wu, Kaiyao, 2026. "Beyond the linear: Green technology innovation, moderators, and global value chain upgrading," Energy Economics, Elsevier, vol. 153(C).
    • Handle: RePEc:eee:eneeco:v:153:y:2026:i:c:s0140988325009041
    DOI: 10.1016/j.eneco.2025.109074
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