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Outward foreign direct investment and green technology innovation: A company and host country perspective

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  • Shao, Yanmin
  • Li, Junlong
  • Zhang, Xueli

Abstract

This study explores the effect of outward foreign direct investment (OFDI) on green technology innovation (GTI) from a company and host country perspective based on the resource-based view and reverse spillover effect. Using the 2003–2019 listed Chinese A-share companies, this research provides micro-level evidence about the moderating effect of company and host country's factor on the relationship between OFDI on GTI. The company's environmental image, its investment breadth and the host country's environmental governance strengthened the relationship between OFDI and GTI, but the geographic distance to the host country weakened it. When engaging in OFDI, to enhance GTI and support the green transition, we recommend that companies develop a positive environmental image, increase their investment breadth and invest in a host country with strict environmental governance and geographical proximity. We have further found that OFDI promotes GTI by increasing overseas income and R&D investment. These findings provide new insights for governments in formulating incentive policies and for companies in choosing investment locations.

Suggested Citation

  • Shao, Yanmin & Li, Junlong & Zhang, Xueli, 2024. "Outward foreign direct investment and green technology innovation: A company and host country perspective," Technological Forecasting and Social Change, Elsevier, vol. 203(C).
    • Handle: RePEc:eee:tefoso:v:203:y:2024:i:c:s0040162524001756
    DOI: 10.1016/j.techfore.2024.123379
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