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Green credit policy and the innovation dilemma: Evidence from China

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  • Xu, Xinkuo
  • Liu, Qianyu

Abstract

This paper examines the differential effects of green credit policy (GCP) on green and other technological innovation of high-polluting enterprises. It verifies that the implementation of GCP has significantly promoted green technological innovation in China, while it has had a crowding-out effect on other technological innovation. The shift in innovation structure occurs through enhancing corporate green cognition and increasing financing costs. Furthermore, for enterprises with higher supply chain resilience and better internal control, the positive impact of GCP on green technological innovation is pronounced, and its crowding-out effect on other technological innovation is not significant.

Suggested Citation

  • Xu, Xinkuo & Liu, Qianyu, 2025. "Green credit policy and the innovation dilemma: Evidence from China," Finance Research Letters, Elsevier, vol. 83(C).
    • Handle: RePEc:eee:finlet:v:83:y:2025:i:c:s1544612325009134
    DOI: 10.1016/j.frl.2025.107654
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    References listed on IDEAS

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    Cited by:

    1. Yan, Yufei & Tan, Linfang & Peng, Junxian, 2025. "Restraint or guidance? The impact of institutional investors' herding behavior on firm innovation," Finance Research Letters, Elsevier, vol. 85(PE).
    2. Ye, Jinfen & Wang, Yubo & Yang, Jiayan, 2025. "Green finance and environmental governance in river basin economies: Mechanism analysis based on green innovation and industrial upgrading in the Yangtze River region," Finance Research Letters, Elsevier, vol. 86(PF).
    3. Meiying Huang & Shi Chen & Pengfei Cheng, 2025. "Green path without waste: zero-waste city pilot construction and corporate green innovation," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-15, December.

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