Foreign direct investment, development strategy, and green innovation

Abstract

In developing countries, foreign direct investment (FDI) plays a significant role in industrial catch-up concerning knowledge acquisition and technological innovation. The Chinese government's development strategy is vital in attracting FDI and green innovation (GI). This article investigates the moderating role of development strategy in the causal relationship between FDI and GI from the perspective of new structural economics. We find a U-shaped association between FDI and GI. Specifically, FDI inhibits GI at its low level, and FDI promotes GI with the accumulation of FDI capital. Therefore, cities with moderate catch-up strategies can maximize the impact of FDI on GI. Development strategies can also hinder the effects of FDI-driven GI in cities with a perfect market system while promoting them in cities with relatively backward, cleaner production technology. The development strategy not only has an impact on the FDI-driven GI effects in the region but also on the FDI-driven GI effects in the surrounding regions through the spatial spillover effect. These findings provide references on what type of FDI the government should introduce and how to guide the market to bring the GI effect of FDI into play.

Promoting the International Competitiveness of Small and Medium-Sized Enterprises Through Cross-Border E-Commerce Development

“…The results shown in Table 6 are consistently and significantly positive, suggesting that income from overseas operations significantly boosts corporate TFP. In the process of internationalization, SMEs always lack bargaining power and learning ability, leading some studies to worry that SMEs in developing countries face a lock-in of technology and low-end links in the division of labor in value chains, which leads to an unfair distribution of interests in the international division of labor (Shao et al, 2023). However, this study finds that internationalization benefits corporate TFP, suggesting that the overseas market expansion effect of cross-border e-commerce enhances SMEs' international competitiveness.…”

Impact of fintech and environmental regulation on green innovation: inspiration from prefecture-level cities in China

“…One is to discuss whether command-andcontrol type or market oriented environmental regulations are more effective in encouraging green innovation (Blackman et al, 2018;Zhang et al, 2020). Market oriented environmental regulations are always more efficient and more likely to stimulate the enthusiasm of enterprises for innovation, while government factors are crucial for cultivating green industries (Grillitsch and Hansen, 2019;Shao et al, 2023). The neutral view is that although market-oriented instruments are efficient, effective governments are equally important for green transformation (Zhou and Wang, 2022).…”