IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v17y2025i4p1560-d1590693.html
   My bibliography  Save this article

Scenario-Based Forecasting of the Impact of Tax Incentives on Green R&D in China’s Wind Power Industry in a Complex Network Environment

Author

Listed:
  • Ying Wang

    (Institute of Economics and Management, Ural Federal University Named After the First President of Russia B.N. Yeltsin, Yekaterinburg 620002, Russia)

  • Igor A. Mayburov

    (Institute of Economics and Management, Ural Federal University Named After the First President of Russia B.N. Yeltsin, Yekaterinburg 620002, Russia
    Institute for Research of Social and Economic Changes and Financial Policy, Financial University under the Government of the Russian Federation, Moscow 125167, Russia)

Abstract

Due to the deteriorating ecological environment in recent years, many countries have introduced relevant policies to support the development of clean energy. This paper focuses on wind power generation as the subject for examining green R&D diffusion. Many enterprises take advantage of the information asymmetry between them and the government to carry out fake research and development and cheat taxes, resulting in a large loss of fiscal revenue for the state. The aim of the study is to simulate different scenarios for the diffusion of green R&D in China’s wind energy industry under different tax rates, incentives, and penalties. The results of the study show that the state’s ability to increase penalties can inhibit firms’ behavior of camouflaging R&D. Under the current tax incentives, the introduction of green R&D quotas in the electricity market, coupled with strong penalties, can increase the real green R&D capability of enterprises. The government’s implementation of zero R&D tax incentives and strong penalties do not increase firms’ green R&D capabilities. The diffusion effect of green R&D is more significant in the context of strong market demand. This suggests that the introduction of a quota system can encourage firms to accelerate the pace of technological innovation, while a strict regulatory environment is necessary to avoid policy abuse and optimize resource allocation.

Suggested Citation

  • Ying Wang & Igor A. Mayburov, 2025. "Scenario-Based Forecasting of the Impact of Tax Incentives on Green R&D in China’s Wind Power Industry in a Complex Network Environment," Sustainability, MDPI, vol. 17(4), pages 1-33, February.
  • Handle: RePEc:gam:jsusta:v:17:y:2025:i:4:p:1560-:d:1590693
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/17/4/1560/pdf
    Download Restriction: no

    File URL: https://www.mdpi.com/2071-1050/17/4/1560/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Rebecca Henderson & Iain Cockburn, 1996. "Scale, Scope, and Spillovers: The Determinants of Research Productivity in Drug Discovery," RAND Journal of Economics, The RAND Corporation, vol. 27(1), pages 32-59, Spring.
    2. Friebe, Christian A. & von Flotow, Paschen & Täube, Florian A., 2014. "Exploring technology diffusion in emerging markets – the role of public policy for wind energy," Energy Policy, Elsevier, vol. 70(C), pages 217-226.
    3. Irem Guceri & Li Liu, 2019. "Effectiveness of Fiscal Incentives for R&D: Quasi-experimental Evidence," American Economic Journal: Economic Policy, American Economic Association, vol. 11(1), pages 266-291, February.
    4. Desislava G. Stoilova, 2024. "Tax Structure and Economic Growth: New Empirical Evidence from the European Union," Journal of Tax Reform, Graduate School of Economics and Management, Ural Federal University, vol. 10(2), pages 240-257.
    5. Goeree, Jacob K. & Holt, Charles A. & Palfrey, Thomas R., 2003. "Risk averse behavior in generalized matching pennies games," Games and Economic Behavior, Elsevier, vol. 45(1), pages 97-113, October.
    6. Pang, Silu & Hua, Guihong & Liu, Hui, 2023. "How do R&D capital market distortions affect innovation efficiency in China? Some evidence about spatial interaction and spillover effects," Socio-Economic Planning Sciences, Elsevier, vol. 90(C).
    7. Natalia Ortiz‐de‐Mandojana & Javier Aguilera‐Caracuel & Matilde Morales‐Raya, 2016. "Corporate Governance and Environmental Sustainability: The Moderating Role of the National Institutional Context," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 23(3), pages 150-164, May.
    8. Deng, Yanru & Nepal, Rabindra & Shao, Xuefeng & Ding, Chante Jian & Wu, Zhan, 2024. "Zooming in or zooming out: Energy strategy, developmental parity and regional entrepreneurial dynamism," Energy Economics, Elsevier, vol. 140(C).
    9. Qian, Zheng & Pei, Yan & Zareipour, Hamidreza & Chen, Niya, 2019. "A review and discussion of decomposition-based hybrid models for wind energy forecasting applications," Applied Energy, Elsevier, vol. 235(C), pages 939-953.
    10. Tasneem Chipty, 2001. "Vertical Integration, Market Foreclosure, and Consumer Welfare in the Cable Television Industry," American Economic Review, American Economic Association, vol. 91(3), pages 428-453, June.
    11. T. Ravichandran & Shu Han & Sunil Mithas, 2017. "Mitigating Diminishing Returns to R&D: The Role of Information Technology in Innovation," Information Systems Research, INFORMS, vol. 28(4), pages 812-827, December.
    12. David R. Agrawal, 2021. "The Internet as a Tax Haven?," American Economic Journal: Economic Policy, American Economic Association, vol. 13(4), pages 1-35, November.
    13. Zhao, Zhen-Yu & Chen, Yu-Long & Chang, Rui-Dong, 2016. "How to stimulate renewable energy power generation effectively? – China's incentive approaches and lessons," Renewable Energy, Elsevier, vol. 92(C), pages 147-156.
    14. Genus, A. & Iskandarova, M., 2020. "Transforming the energy system? Technology and organisational legitimacy and the institutionalisation of community renewable energy," Renewable and Sustainable Energy Reviews, Elsevier, vol. 125(C).
    15. Jie Zhang & Lingfeng Dong & Ting Ji, 2023. "The Diffusion of Competitive Platform-Based Products with Network Effects," Sustainability, MDPI, vol. 15(11), pages 1-18, May.
    16. Hong Xu & Kai Lin & Lei Qiu, 2023. "The Impact of Local Government Environmental Target Constraints on the Performance of Heavy Pollution Industries," Sustainability, MDPI, vol. 15(22), pages 1-24, November.
    17. Pujari, Devashish & Wright, Gillian & Peattie, Ken, 2003. "Green and competitive: Influences on environmental new product development performance," Journal of Business Research, Elsevier, vol. 56(8), pages 657-671, August.
    18. Hashemizadeh, Ali & Ju, Yanbing & Abadi, Faezeh Zareian Baghdad, 2024. "Policy design for renewable energy development based on government support: A system dynamics model," Applied Energy, Elsevier, vol. 376(PB).
    19. Cheng, Xiaobin & Liu, Pengfei & Zhu, Lei, 2024. "The impact of electricity market reform on renewable energy production," Energy Policy, Elsevier, vol. 194(C).
    20. deCastro, M. & Salvador, S. & Gómez-Gesteira, M. & Costoya, X. & Carvalho, D. & Sanz-Larruga, F.J. & Gimeno, L., 2019. "Europe, China and the United States: Three different approaches to the development of offshore wind energy," Renewable and Sustainable Energy Reviews, Elsevier, vol. 109(C), pages 55-70.
    21. Konshik Kim, 2018. "DIMINISHING RETURNS TO R&D INVESTMENT ON INNOVATION IN MANUFACTURING SMEs: DO THE TECHNOLOGICAL INTENSITY OF INDUSTRY MATTER?," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 22(07), pages 1-27, October.
    22. Song, Malin & Wang, Shuhong, 2016. "Can employment structure promote environment-biased technical progress?," Technological Forecasting and Social Change, Elsevier, vol. 112(C), pages 285-292.
    23. Ezekiel Oluwagbemiga Oyerogba & Julius Adeyemi Alamu & Sunday Kola Olugbenro & Tolulope Oyebanke Sangodare, 2024. "Tax Incentives and Foreign Direct Investment: Evidence from the Nigeria Listed Manufacturing Firms," Journal of Tax Reform, Graduate School of Economics and Management, Ural Federal University, vol. 10(2), pages 355-380.
    24. Ye Chenghao & Igor A. Mayburov & Wang Ying, 2024. "Fiscal Effects of Environmental Tax Reform: A Comparative Analysis of China, Germany and the United Kingdom," Journal of Tax Reform, Graduate School of Economics and Management, Ural Federal University, vol. 10(2), pages 258-270.
    25. Chang, Kai & Xue, Chenqi & Zhang, Huijia & Zeng, Yonghong, 2022. "The effects of green fiscal policies and R&D investment on a firm's market value: New evidence from the renewable energy industry in China," Energy, Elsevier, vol. 251(C).
    26. Mario Ragwitz & Simone Steinhilber, 2014. "Effectiveness and efficiency of support schemes for electricity from renewable energy sources," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 3(2), pages 213-229, March.
    27. Zhao, Longfeng & Yang, Yajie & Bai, Xiao & Chen, Lin & Lu, An-Liang & Zhang, Xin & Chen, Wei-Qiang, 2023. "Structure, robustness and supply risk in the global wind turbine trade network," Renewable and Sustainable Energy Reviews, Elsevier, vol. 177(C).
    28. Zhikuo Liu & Huihang Wu & Jianfeng Wu, 2019. "Location-based tax incentives and entrepreneurial activities: evidence from Western Regional Development Strategy in China," Small Business Economics, Springer, vol. 52(3), pages 729-742, March.
    29. Chen, Feng & Wu, Bin & Lou, Wenqian, 2021. "An evolutionary analysis on the effect of government policies on green R & D of photovoltaic industry diffusion in complex network," Energy Policy, Elsevier, vol. 152(C).
    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. Lu, Hongfang & Ma, Xin & Huang, Kun & Azimi, Mohammadamin, 2020. "Prediction of offshore wind farm power using a novel two-stage model combining kernel-based nonlinear extension of the Arps decline model with a multi-objective grey wolf optimizer," Renewable and Sustainable Energy Reviews, Elsevier, vol. 127(C).
    2. Santiago Salvador & Marta Chantal Ribeiro, 2023. "Socio‐economic, legal, and political context of offshore renewable energies," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 12(2), March.
    3. Kamini Gupta & Donal Crilly & Thomas Greckhamer, 2020. "Stakeholder engagement strategies, national institutions, and firm performance: A configurational perspective," Strategic Management Journal, Wiley Blackwell, vol. 41(10), pages 1869-1900, October.
    4. Anup Banerjee & Mattias Nordqvist & Karin Hellerstedt, 2020. "The role of the board chair—A literature review and suggestions for future research," Corporate Governance: An International Review, Wiley Blackwell, vol. 28(6), pages 372-405, November.
    5. Pereira, Pedro & Ribeiro, Tiago, 2011. "The impact on broadband access to the Internet of the dual ownership of telephone and cable networks," International Journal of Industrial Organization, Elsevier, vol. 29(2), pages 283-293, March.
    6. Vitaliy Roud & Thomas Wolfgang Thurner, 2018. "The Influence of State‐Ownership on Eco‐Innovations in Russian Manufacturing Firms," Journal of Industrial Ecology, Yale University, vol. 22(5), pages 1213-1227, October.
    7. de Rassenfosse, Gaétan, 2013. "Do firms face a trade-off between the quantity and the quality of their inventions?," Research Policy, Elsevier, vol. 42(5), pages 1072-1079.
    8. Zhang, Feng & Jiang, Guohua & Cantwell, John A., 2015. "Subsidiary exploration and the innovative performance of large multinational corporations," International Business Review, Elsevier, vol. 24(2), pages 224-234.
    9. Lamberova, Natalia, 2021. "The puzzling politics of R&D: Signaling competence through risky projects," Journal of Comparative Economics, Elsevier, vol. 49(3), pages 801-818.
    10. Cassiman, Bruno & Perez-Castrillo, David & Veugelers, Reinhilde, 2002. "Endogenizing know-how flows through the nature of R&D investments," International Journal of Industrial Organization, Elsevier, vol. 20(6), pages 775-799, June.
    11. Matthias Firgo & Peter Mayerhofer, 2015. "Wissens-Spillovers und regionale Entwicklung - welche strukturpolitische Ausrichtung optimiert des Wachstum?," Working Paper Reihe der AK Wien - Materialien zu Wirtschaft und Gesellschaft 144, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik.
    12. Ispano, Alessandro & Schwardmann, Peter, 2017. "Cooperating over losses and competing over gains: A social dilemma experiment," Games and Economic Behavior, Elsevier, vol. 105(C), pages 329-348.
    13. Thomas Bolli & Martin Woerter, 2013. "Technological Diversification and Innovation Performance," KOF Working papers 13-336, KOF Swiss Economic Institute, ETH Zurich.
    14. Forman, Chris & van Zeebroeck, Nicolas, 2019. "Digital technology adoption and knowledge flows within firms: Can the Internet overcome geographic and technological distance?," Research Policy, Elsevier, vol. 48(8), pages 1-1.
    15. Albert N. Link & John T. Scott, 2018. "Propensity to Patent and Firm Size for Small R&D-Intensive Firms," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 52(4), pages 561-587, June.
    16. Kathryn Rudie Harrigan & Maria Chiara Guardo & Bo Cowgill, 2017. "Multiplicative-innovation synergies: tests in technological acquisitions," The Journal of Technology Transfer, Springer, vol. 42(5), pages 1212-1233, October.
    17. Laura Alfaro & Nick Bloom & Paola Conconi & Harald Fadinger & Patrick Legros & Andrew F Newman & Raffaella Sadun & John Van Reenen, 2024. "Come Together: Firm Boundaries and Delegation," Journal of the European Economic Association, European Economic Association, vol. 22(1), pages 34-72.
    18. Zhang, Yibin & Hafezi, Maryam & Zhao, Xuan & Shi, Victor, 2017. "Reprint of “The impact of development cost on product line design and its environmental performance”," International Journal of Production Economics, Elsevier, vol. 194(C), pages 126-134.
    19. Gregory, Julian & Sovacool, Benjamin K., 2019. "Rethinking the governance of energy poverty in sub-Saharan Africa: Reviewing three academic perspectives on electricity infrastructure investment," Renewable and Sustainable Energy Reviews, Elsevier, vol. 111(C), pages 344-354.
    20. Erhao Xie, 2019. "Monetary Payoff and Utility Function in Adaptive Learning Models," Staff Working Papers 19-50, Bank of Canada.

    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:4:p:1560-:d:1590693. 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.