Environmental regulation, green innovation, and international competitiveness of manufacturing enterprises in China: From the perspective of heterogeneous regulatory tools

Abstract

Based on combined data from the China Patent Database, China Industrial Enterprise Database, and China Customs Import and Export Database for the period 2004–2010, this study investigates the impact of heterogeneous environmental regulations on the export technological sophistication of manufacturing enterprises. Given deepening international market segmentation of production and the increasing proportion of intermediate trade, and compared with the traditional method based on exports, the export technological sophistication calculated here, based on value-added, is closer to the true level. Since there has been no in-depth comparative study on the relationship between heterogeneous environmental regulation and export technological sophistication, this study fills the gap. The results show that all three regulation types bear a U-shaped impact on export technological sophistication. Command-control regulation exhibits a restraining effect on mixed trade, eastern, and foreign-funded enterprises. Market-incentive regulation promotes processing and mixed trade enterprises as well as domestic and foreign-funded enterprises. Voluntary-participation regulation promotes all enterprises with different trade patterns and ownership. The mechanism analysis shows that command-control and market-participation environmental regulations affect export technological sophistication through the green invention and green utility innovation channels, while, additionally, market-incentive environmental regulation affects export technological sophistication through the green design innovation channel. Considering the environmental governance issues, the policy implications for enhancing the entire industrial chain and enterprises’ export competitiveness are clear. Due to the unclear functions and powers of competent departments and a rigid threshold, command-control regulation is not conducive to cleaner production technology and the promotion of enterprises’ export competitiveness; it should thus be discouraged. Although both market-incentive and voluntary-participation regulations have promoted cleaner production technology and enterprises’ competitiveness significantly, the environmental tax system requires continuous improvement. The government should continue to raise public involvement in environmental protection to enrich the channels and forms of environmental management.

Environmental regulation, environmental responsibility, and green technology innovation: Empirical research from China

“…Environmental regulation is mainly measured by indicators, such as investment expenditure in environmental governance, composite emission index, or numbers of environmental violations [ 2 , 3 , 7 , 38 ]. Most measurements are based on macro-data at the city level or above, which could not be directly used to measure the environmental supervision of the company [ 46 ].…”

“…Green innovation runs through the entire process of an enterprise’s production, consumption, and service, involving renovations of technology, organization, and institutions [ 1 ]. Existing studies on environmental regulation are mostly conducted on the level of regions and industry, lacking in-depth discussion on the environmental regulation effects and inner mechanism of enterprises [ 2 ]. It is of great significance to evaluate the response of manufacturing enterprises to environmental regulation policies.…”

“…Numerous scholars have agreed that the economic effects of environmental regulations from two major perspectives, namely the “compliance cost” and the “Porter Hypothesis” [ 2 – 5 ]. On the one hand, pollution control action has consumed large amounts of resources for manufacturing enterprises.…”

Research on the promoting effect of servitization on export technological sophistication of manufacturing enterprises

“…With the refinement of international market fragmentation and the deep change of trade pattern, the export technological sophistication index calculated by traditional trade statistics method can not truly and accurately measure the technology content of export. Therefore, based on the research of [ 19 ], this article uses the improved two-step method of [ 43 ] to measure the export technological sophistication index. In the first step, the export technological sophistication index at the product level is calculated as follows.…”

Environmental Regulations and Corporate Green Innovation in China: The Role of City Leaders’ Promotion Pressure

“…Green innovation refers to innovation activities related to technology or products in the fields of energy conservation, environmental protection, and resource recycling, which is one of the most important means for enterprises to achieve sustainable development [9]. It reflects the strategic needs of enterprises in various aspects, such as the pursuit of technological innovation [10], the fulfillment of corporate social responsibility [11], transformation, and upgrading [12]. China's central and local governments are trying to encourage companies to invest more in environmental protection and increase green innovation.…”