Evolutionary game analysis of green technology innovation under the carbon emission trading mechanism

Abstract

The carbon emission trading mechanism is an environmental regulation that has both market and government orientations and has a significant impact on the innovation of green technology and low-carbon development. Based on the evolutionary game theory and considering the strategic choices of different enterprise types in the carbon trading market, a three-party game model, involving enterprise A, the government, and enterprise B, is constructed. Based on data on the carbon emission trading market, data simulation is used to analyze the evolutionary game trajectory of government and enterprise behavior strategies. This study finds that 1) carbon prices, additional green technology innovation benefits, and innovation incentives have a significant impact on corporate strategy choices, as with higher carbon prices, additional benefits, and greater innovation incentives, green technology innovation can compensate for corporate innovation investment enterprises tending to choose innovative strategies; 2) enterprises with different innovation inputs and outputs have different strategic choices under identical conditions, such as small enterprise B having higher input and lower output than large enterprise A, and therefore, when the government encourages policies such as innovation subsidies, it must treat different types of enterprises differently; and 3) the cost of supervision and punishment can help avoid behaviors such as “floating green” and “fraudulent compensation”, but enterprises and the supervision strategy of the government are affected by the associated supervision cost. This study not only further verifies the Porter hypothesis in both theory and practice but also has important implications for corporate green innovation strategies and government regulatory behavior while providing a reference for the carbon emission trading market and corporate low-carbon development.

Substantial innovation or strategic innovation: An evolutionary game analysis of companies' green technology innovation strategies under carbon emission trading market

“…In general, the government provides a subsidy of 500 RMB/ton of standard coal to energy service companies. Through discounting, the subsidy standard for companies carrying out CO 2 emission reduction is set to 200 RMB/ton (Cui et al, 2022). According to the "Ecological Environmental Protection Comprehensive Administrative Law Enforcement Matters Guidance Catalog (2020 Edition)," the penalty for a company's strategic innovation is 2.5 times its subsidy amount;…”

Impact of Intelligent Manufacturing on Total-Factor Energy Efficiency: Mechanism and Improvement Path

“…The profound logic of carbon emission trading policy is the commercialization, asset, and data of carbon emission rights. By limiting control of enterprise greenhouse gas emissions and emission quotas, with the help of market mechanisms to transform environment negative external cost into enterprise internal production costs, this reverses transmission control to complete the performance conditions, promotes the carbon market to reach the Pareto optimal situation, and finally realizes the quality and efficiency of energy utilization, energy conservation and emission reduction of the whole economy and society [60,61]. An appropriate and reasonably designed environmental regulation policy will promote the constrained individuals to stimulate the consciousness of technological innovation under limited conditions, dynamically integrate the factor input combination, and improve the green total factor productivity [62].…”

The Non-Linear Effect of Dual Environmental Regulation on Urban Green Total Factor Productivity: Evidence from 284 Cities in China

“…These two forms of regulation complement each other and demonstrate the involvement of multiple stakeholders in environmental governance. Previous studies have indicated that environmental regulation has both an "innovation compensation effect" [7] and a "compliance cost effect" [8] on GTFP, which yield contrasting impacts. Hence, the question of whether dual environmental regulation Sustainability 2024, 16, 4894 2 of 22 can facilitate the enhancement of GTFP in Chinese urban areas and, if so, the manner in which it may do so, represents a crucial theoretical and practical concern.…”