The impact of local government competition and green technology innovation on economic low-carbon transition: new insights from China

Abstract

The government-led Chinese economic development system determines that local government competition is a significant factor affecting the economic low-carbon transition. Driving an economic development mode with green technology innovation as the core is the critical path to realizing an economic low-carbon transition. Consequently, it is of significant practical relevance to investigate the impact of local government competition and green technology innovation on the economic low-carbon transition under the government-led Chinese economic development system. This paper systematically explores the nexus between green technology innovation and economic low-carbon transition in terms of local government competition perspective using the system generalized method of moments, panel threshold model, and geographically weighted regression on the basis of a dataset of 30 provincial administrative areas in China from a period of 2006–2019. The results indicate that green technology innovation significantly promotes the economic low-carbon transition. Local government competition not only significantly dampens the economic low-carbon transition but also considerably inhibits the positive effect of green technology innovation on the economic low-carbon transition. A significant N-shaped association is evident between green technology innovation and the economic low-carbon transition when green technology innovation is applied as a threshold, while such association is insignificant when local government competition is used as a threshold. Compared with high-competition intensity areas, green technology innovation promotes economic low-carbon transition weaker in low- competition intensity areas, while local government competition inhibits economic low-carbon transition stronger. However, local government competition significantly inhibits the positive effect of green technology innovation on the economic low-carbon transition in low-competition intensity areas, while insignificant in high-competition intensity areas. The geographically weighted regression technique as a whole also verified the above results. Therefore, policymakers should not only increase research and development investment in green technologies, but also develop a regionally linked low-carbon emission reduction system to avoid ineffective competition among governments to facilitate the earlier fulfillment of the “dual carbon” goal.

The corporate path to green innovation: does the digital economy matter?

“…China is facing several challenges in its efforts to achieve technological innovation and enhance R&D achievements. Among these obstacles are issues such as low conversion rates of R&D achievements, a disconnect between the innovation chain and industrial chain and insufficient independent innovation momentum (Xu et al 2023).…”

The Role of Green Finance in Promoting Sustainable Development Goals (SDGs) Through the Mediation Effect of Green Technology Innovation

“…Green initiatives have less of an impact on the environment, and it's cheaper to nance enterprises that use GTI because of government incentives like incubation, guarantees, rate of interest subsidies, etc (Mansour, 2023). The study (Xu et al, 2023) employs panel threshold modeling, the generalized system method of moments, and geographically weighted regression to systematically investigate the relationship among innovative green technology and the nancial impact of the environmental friendly transition from the perspective of local government struggle. The ndings show that developing of green technologies considerably aids the transition to a low-carbon economy.…”

Government Competition for Capital, Land Resource Misallocation and Carbon Emission

“…In addition, capital flows were also found to be an important mechanism by which government tax competition affects sustainable development [13]. Xu et al (2023) argued that government competition not only directly inhibits low-carbon development, but also reduces the role of green technological innovations as a driver of low-carbon transitions [14]. Nonetheless, some scholars have found that local adoption of tax competition can also be advantageous in mitigating CE.…”