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Market-based Environmental Policy Instrument Mixes and Firms’ Environmental Innovation: A Fuzzy-set Qualitative Comparative Analysis

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  • Zhongju Liao
  • Ping Liu

Abstract

This study analyzed the antecedents of firms’ environmental innovation considering policy instrument mixes. Selecting 209 firms as the research sample and employing the fuzzy-set qualitative comparative analysis method, we examined the effect of five types of market-based environmental policy instruments on firms’ environmental innovation. We found that environmental innovation was not contingent on any individual condition, but resulted from the mix of the five market-based environmental policy instruments, which formed four paths and three models, namely, incentives-punishment, financial support, and subsidies-demand. The study has implications in improving the applicability of policies and formulating an effective environmental policy framework.

Suggested Citation

  • Zhongju Liao & Ping Liu, 2022. "Market-based Environmental Policy Instrument Mixes and Firms’ Environmental Innovation: A Fuzzy-set Qualitative Comparative Analysis," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 58(14), pages 3976-3984, November.
    • Handle: RePEc:mes:emfitr:v:58:y:2022:i:14:p:3976-3984
    DOI: 10.1080/1540496X.2022.2079974
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