IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v17y2025i10p4544-d1657044.html
   My bibliography  Save this article

The Dynamic Relationships Among Green Technological Innovation, Government Policies, and the Low-Carbon Transformation of the Manufacturing Industry in the Yangtze River Economic Belt: An Analysis Based on the PVAR Model

Author

Listed:
  • Jiawei Shangguan

    (School of Management Science and Engineering, Nanjing University of Information Science and Technology, Nanjing 210044, China)

  • Pingping Xiong

    (School of Management Science and Engineering, Nanjing University of Information Science and Technology, Nanjing 210044, China)

  • Zhexuan Ye

    (School of Business, Nanjing University of Information Science and Technology, Nanjing 210044, China)

  • Jie Wang

    (School of Mathematics and Statistics, Nanjing University of Information Science and Technology, Nanjing 210044, China)

Abstract

Green technological innovation, government policies, and the low-carbon transformation of the manufacturing industry are critical for promoting high-quality development in the Yangtze River Economic Belt. This study, based on input–output and total factor productivity theories, selects relevant variables and utilizes a PVAR model to analyze data from 11 provinces in the region from 2011 to 2023. The empirical results indicate that (1) green technological innovation and the low-carbon transformation of the manufacturing industry exhibit significant bidirectional causality, with the low-carbon transformation exerting a stronger positive impact on green innovation, underscoring the “demand–pull” effect. (2) Government policies provide initial impetus for both green innovation and low-carbon transformation but show signs of self-restriction and diminishing returns over time, reflecting a typical “policy lag–decay” pattern. (3) Variance decomposition highlights the dominant role of green technological innovation in driving long-term low-carbon transformation, while the direct impact of government policies remains limited, indicating that policy effectiveness is largely mediated through technological channels. These findings emphasize the importance of enhancing regional green innovation capacity, establishing dynamic policy feedback mechanisms, and fostering sustained technological advancement as key pathways to deepening the low-carbon transformation.

Suggested Citation

  • Jiawei Shangguan & Pingping Xiong & Zhexuan Ye & Jie Wang, 2025. "The Dynamic Relationships Among Green Technological Innovation, Government Policies, and the Low-Carbon Transformation of the Manufacturing Industry in the Yangtze River Economic Belt: An Analysis Bas," Sustainability, MDPI, vol. 17(10), pages 1-21, May.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:10:p:4544-:d:1657044
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/17/10/4544/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/17/10/4544/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Shao, Yanmin & Chen, Zhongfei, 2022. "Can government subsidies promote the green technology innovation transformation? Evidence from Chinese listed companies," Economic Analysis and Policy, Elsevier, vol. 74(C), pages 716-727.
    2. Chen, Lei & Li, Ke & Chen, Shuying & Wang, Xiaofei & Tang, Liwei, 2021. "Industrial activity, energy structure, and environmental pollution in China," Energy Economics, Elsevier, vol. 104(C).
    3. M. Hashem Pesaran, 2006. "Estimation and Inference in Large Heterogeneous Panels with a Multifactor Error Structure," Econometrica, Econometric Society, vol. 74(4), pages 967-1012, July.
    4. Razzaq, Asif & Sharif, Arshian & An, Hui & Aloui, Chaker, 2022. "Testing the directional predictability between carbon trading and sectoral stocks in China: New insights using cross-quantilogram and rolling window causality approaches," Technological Forecasting and Social Change, Elsevier, vol. 182(C).
    5. Stefan Ambec & Mark A. Cohen & Stewart Elgie & Paul Lanoie, 2013. "The Porter Hypothesis at 20: Can Environmental Regulation Enhance Innovation and Competitiveness?," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 7(1), pages 2-22, January.
    6. Quan Guo & Min Zhou & Nana Liu & Yaoyu Wang, 2019. "Spatial Effects of Environmental Regulation and Green Credits on Green Technology Innovation under Low-Carbon Economy Background Conditions," IJERPH, MDPI, vol. 16(17), pages 1-16, August.
    7. Lanjouw, Jean Olson & Mody, Ashoka, 1996. "Innovation and the international diffusion of environmentally responsive technology," Research Policy, Elsevier, vol. 25(4), pages 549-571, June.
    8. Pingkuo, Liu & Huan, Peng, 2022. "What drives the green and low-carbon energy transition in China?: An empirical analysis based on a novel framework," Energy, Elsevier, vol. 239(PE).
    9. Virginia D. McConnell & Robert M. Schwab, 1990. "The Impact of Environmental Regulation on Industry Location Decisions: The Motor Vehicle Industry," Land Economics, University of Wisconsin Press, vol. 66(1), pages 67-81.
    10. Ming Yi & Xiaomeng Fang & Le Wen & Fengtao Guang & Yao Zhang, 2019. "The Heterogeneous Effects of Different Environmental Policy Instruments on Green Technology Innovation," IJERPH, MDPI, vol. 16(23), pages 1-19, November.
    11. Holtz-Eakin, Douglas & Newey, Whitney & Rosen, Harvey S, 1988. "Estimating Vector Autoregressions with Panel Data," Econometrica, Econometric Society, vol. 56(6), pages 1371-1395, November.
    12. Tian, Yanping & Song, Wenjing & Liu, Min, 2021. "Assessment of how environmental policy affects urban innovation: Evidence from China’s low-carbon pilot cities program," Economic Analysis and Policy, Elsevier, vol. 71(C), pages 41-56.
    13. Rennings, Klaus & Ziegler, Andreas & Ankele, Kathrin & Hoffmann, Esther, 2006. "The influence of different characteristics of the EU environmental management and auditing scheme on technical environmental innovations and economic performance," Ecological Economics, Elsevier, vol. 57(1), pages 45-59, April.
    14. Na Zhang & Jinqian Deng & Fayyaz Ahmad & Muhammad Umar Draz & Nabila Abid, 2023. "The dynamic association between public environmental demands, government environmental governance, and green technology innovation in China: evidence from panel VAR model," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(9), pages 9851-9875, September.
    15. Pei Wang & Cong Dong & Nan Chen & Ming Qi & Shucheng Yang & Amuji Bridget Nnenna & Wenxin Li, 2021. "Environmental Regulation, Government Subsidies, and Green Technology Innovation—A Provincial Panel Data Analysis from China," IJERPH, MDPI, vol. 18(22), pages 1-19, November.
    16. Rosa Maria Dangelico & Devashish Pujari & Pierpaolo Pontrandolfo, 2017. "Green Product Innovation in Manufacturing Firms: A Sustainability‐Oriented Dynamic Capability Perspective," Business Strategy and the Environment, Wiley Blackwell, vol. 26(4), pages 490-506, May.
    17. Ouyang, Xiaoling & Li, Qiong & Du, Kerui, 2020. "How does environmental regulation promote technological innovations in the industrial sector? Evidence from Chinese provincial panel data," Energy Policy, Elsevier, vol. 139(C).
    18. Zhou, P. & Ang, B.W. & Poh, K.L., 2008. "A survey of data envelopment analysis in energy and environmental studies," European Journal of Operational Research, Elsevier, vol. 189(1), pages 1-18, August.
    19. Love, Inessa & Zicchino, Lea, 2006. "Financial development and dynamic investment behavior: Evidence from panel VAR," The Quarterly Review of Economics and Finance, Elsevier, vol. 46(2), pages 190-210, May.
    20. Kivimaa, Paula & Kern, Florian, 2016. "Creative destruction or mere niche support? Innovation policy mixes for sustainability transitions," Research Policy, Elsevier, vol. 45(1), pages 205-217.
    21. Yu Hao & Yunxia Guo & Haitao Wu, 2022. "The role of information and communication technology on green total factor energy efficiency: Does environmental regulation work?," Business Strategy and the Environment, Wiley Blackwell, vol. 31(1), pages 403-424, January.
    22. Barbera, Anthony J. & McConnell, Virginia D., 1990. "The impact of environmental regulations on industry productivity: Direct and indirect effects," Journal of Environmental Economics and Management, Elsevier, vol. 18(1), pages 50-65, January.
    23. Wei Zhang & Hao Zhou & Jie Chen & Zifu Fan, 2022. "An Empirical Analysis of the Impact of Digital Economy on Manufacturing Green and Low-Carbon Transformation under the Dual-Carbon Background in China," IJERPH, MDPI, vol. 19(20), pages 1-22, October.
    24. Taohong Wang & Zhe Song & Jing Zhou & Huaping Sun & Fengqin Liu, 2022. "Low-Carbon Transition and Green Innovation: Evidence from Pilot Cities in China," Sustainability, MDPI, vol. 14(12), pages 1-21, June.
    25. Ben Lahouel, Béchir & Taleb, Lotfi & Ben Zaied, Younes & Managi, Shunsuke, 2021. "Does ICT change the relationship between total factor productivity and CO2 emissions? Evidence based on a nonlinear model," Energy Economics, Elsevier, vol. 101(C).
    26. Yingyuan Guo & Xingneng Xia & Sheng Zhang & Danping Zhang, 2018. "Environmental Regulation, Government R&D Funding and Green Technology Innovation: Evidence from China Provincial Data," Sustainability, MDPI, vol. 10(4), pages 1-21, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bu, Maoliang & Qiao, Zhenzi & Liu, Beibei, 2020. "Voluntary environmental regulation and firm innovation in China," Economic Modelling, Elsevier, vol. 89(C), pages 10-18.
    2. Yuhua Ma & Tong Lin & Qifang Xiao, 2022. "The Relationship between Environmental Regulation, Green-Technology Innovation and Green Total-Factor Productivity—Evidence from 279 Cities in China," IJERPH, MDPI, vol. 19(23), pages 1-22, December.
    3. Gao, Pengfei & Li, Zhiyi & Shi, Rubiao, 2024. "Impact of natural resource dependence on green technology development: Role of digital governance in mitigating resource-curse using big data," Resources Policy, Elsevier, vol. 92(C).
    4. Xinyu Wang & Yuanze Chai & Wensen Wu & Adnan Khurshid, 2023. "The Empirical Analysis of Environmental Regulation’s Spatial Spillover Effects on Green Technology Innovation in China," IJERPH, MDPI, vol. 20(2), pages 1-14, January.
    5. Xiaoli Shi & Ying Chen & Qianju Cheng, 2022. "Environmental Regulation, Environmental Knowledge Spillover, and Regional Economic Growth in China: An Empirical Test Based on the Spatial Durbin Model," Sustainability, MDPI, vol. 14(21), pages 1-23, November.
    6. Hille, Erik & Althammer, Wilhelm & Diederich, Henning, 2020. "Environmental regulation and innovation in renewable energy technologies: Does the policy instrument matter?," Technological Forecasting and Social Change, Elsevier, vol. 153(C).
    7. Zhe Xu & Ying Wang & Xiaoliang Shi & Yingying Qiu & Chunzi Su & Dan He, 2025. "The Impact of Environmental Subsidies and Enforcement on Green Innovation: Evidence from Heavy-Polluting Enterprises in China," Sustainability, MDPI, vol. 17(3), pages 1-25, February.
    8. Durán-Romero, Gemma & López, Ana M. & Beliaeva, Tatiana & Ferasso, Marcos & Garonne, Christophe & Jones, Paul, 2020. "Bridging the gap between circular economy and climate change mitigation policies through eco-innovations and Quintuple Helix Model," Technological Forecasting and Social Change, Elsevier, vol. 160(C).
    9. Themann, Michael & Koch, Nicolas, 2021. "Catching up and falling behind: Cross-country evidence on the impact of the EU ETS on firm productivity," Ruhr Economic Papers 904, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    10. Thomas Bittmann & Jens‐Peter Loy & Sven Anders, 2020. "Product differentiation and cost pass‐through: industry‐wide versus firm‐specific cost shocks," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 64(4), pages 1184-1209, October.
    11. Muyao Li & Jinsong Zhang & Ramakrishnan Ramanathan & Ruiqian Li, 2020. "Opening the Black Box: The Impacts of Environmental Regulations on Technological Innovation," IJERPH, MDPI, vol. 17(12), pages 1-18, June.
    12. Zhao, Ziyi & Zhao, Yuhuan & Lv, Xin & Li, Xiaoping & Zheng, Lu & Fan, Shunan & Zuo, Sumin, 2024. "Environmental regulation and green innovation: Does state ownership matter?," Energy Economics, Elsevier, vol. 136(C).
    13. Sun, Yunpeng & Razzaq, Asif & Sun, Huaping & Irfan, Muhammad, 2022. "The asymmetric influence of renewable energy and green innovation on carbon neutrality in China: Analysis from non-linear ARDL model," Renewable Energy, Elsevier, vol. 193(C), pages 334-343.
    14. Claudia Ghisetti & Francesco Quatraro, 2013. "Beyond the Inducement in Climate Change: Do Environmental Performances Spur Enrivornmental Technologies? A Regional Analysis of Cross-Sectoral Differences," Working Papers 2013112, University of Ferrara, Department of Economics.
    15. Husain, Shaiara & Sohag, Kazi & Wu, Yanrui, 2024. "Proven reserve oil and renewable energy nexus: Efficacy of policy stringency," Resources Policy, Elsevier, vol. 90(C).
    16. Dezhong Duan & Qifan Xia, 2021. "Does Environmental Regulation Promote Environmental Innovation? An Empirical Study of Cities in China," IJERPH, MDPI, vol. 19(1), pages 1-18, December.
    17. Ferris, Ann & Garbaccio, Richard & Marten, Alex & Wolverton, Ann, 2017. "The Impacts of Environmental Regulation on the U.S. Economy," National Center for Environmental Economics-NCEE Working Papers 280936, United States Environmental Protection Agency (EPA).
    18. repec:hal:wpaper:hal-00860045 is not listed on IDEAS
    19. Xiang Deng & Li Li, 2020. "Promoting or Inhibiting? The Impact of Environmental Regulation on Corporate Financial Performance—An Empirical Analysis Based on China," IJERPH, MDPI, vol. 17(11), pages 1-17, May.
    20. Lorena D’Agostino, 2015. "How MNEs respond to environmental regulation: integrating the Porter hypothesis and the pollution haven hypothesis," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 32(2), pages 245-269, August.
    21. Hailan Yang & Xiangjiao Shi & Syed Ghulam Meran Shah, 2024. "Can heterogeneous media attention invigorate green technological innovation: A moderating role of chief executive officer narcissism," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 31(5), pages 3804-3822, September.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:17:y:2025:i:10:p:4544-:d:1657044. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.