The impact of government intervention on innovation efficiency of green technology—a threshold effect analysis based on environmental taxation and government subsidies

Abstract

Research and promotion of green technology can improve energy efficiency and help to optimize energy structure, which are key considerations in achieving the “dual carbon” goals of carbon peaking and carbon neutrality. Owing to the “dual externality” arising from green technology innovation (GTI), government policies have an important impact on this area. Environmental taxes and government subsidies are important means for governments to improve GTI and optimize energy utilization, with different environmental taxes and subsidies having different impacts. This study evaluates the impact of environmental taxes and government subsidies in China from 2009 to 2019, and assesses how these policies interacted with each other to determine China’s efficiency in GTI over this period. The study’s findings based on analysis of 30 provinces and cities in China indicate that environmental taxes have a threshold effect on the development of green technologies, and that the current level of taxation is insufficient to encourage optimized development in this area. Government subsidies can also help to reduce the negative effects arising from the current environmental tax burden. To optimize government policy implementation in this area, improve the level of GTI, and improve energy use efficiency, this study proposes countermeasures based on differentiated policies, including gradually increasing the rate and scope of environmental taxation, and strengthening the supervision of government subsidies.

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

“…GTI is characterized by "double externalities" (Li & Rao, 2023) and inevitably involves market failure and underinvestment (Tassey, 2004). Furthermore, GTI has a long cycle and a high degree of risk.…”

The influence of agricultural insurance on agricultural carbon emissions: evidence from China’s crop and livestock sectors

“…For instance, the implementation of methane capture devices in animal management and the adoption biopesticides in grain farming. On the other hand, green technology efficiency is centered around utilizing green technology to enhance resource usage efficiency and minimize environmental effects, such as the widespread utilization of modern agricultural devices and equipment that can enhance both production efficiency and labor efficiency (Li and Rao, 2023).…”