Assessing the impact of green tax reforms on corporate environmental performance and economic growth: do green reforms promote the environmental performance in heavily polluted enterprises?

Based on Porter's hypothesis and Pollution Shelter's hypothesis, this paper firstly constructs a mechanism of environmental protection tax law and corporate environmental performance. Secondly, it empirically examines the impact of green tax reform on corporate environmental performance and its internal mechanism through the difference in difference (DID) method. The study findings firstly reveal that environmental protection tax law significantly and progressively promotes the improvement of corporate environmental performance. Secondly, the heterogeneity analysis results show that the promotion effect of environmental protection tax law on corporate environmental performance is significant in enterprises with strong financial constraints and stronger internal transparency. The environmental performance improvement effect of the state-owned enterprises is stronger, which indicates that state-owned enterprises can set an example in the face of the formal implementation of the environmental protection tax law. In addition, the heterogeneity of corporate governance shows that the background of senior executives is an important factor affecting the effect of environmental performance improvement. Thirdly, the mechanism analysis indicates that the environmental protection tax law mainly promotes the improvement of enterprise environmental performance by strengthening the local government's enforcement rigidity, improving the local government's environmental concern, promoting enterprise green innovation, and resolving the collusion between government and enterprise. Further analysis shows that the environmental protection tax law based on the empirical results of this paper did not significantly trigger the phenomenon of cross-regional negative pollution transfer of enterprises. The findings of the study have important enlightenment on improving the green governance of enterprises and promoting the high-quality development of national economy.

The spatial spillover effect of higher SO2 emission tax rates on PM2.5 concentration in China

In this paper, the adoption of SO₂ emission tax rates higher than the legal minimum standard is regarded as a noteworthy policy reform in China (quasi-natural experiment), and a spatial Difference-in-Differences (Spatial-DID) model is constructed to test the direct effects (local effects) and indirect effects (spatial spillover effects) of SO₂ emission tax policy reform on PM_2.5 concentrations in the atmosphere of 285 China's cities. The estimation and calculation results of the Spatial-DID model show that the SO₂ emission tax policy reform can significantly reduce local PM_2.5 concentration and significantly promote PM_2.5 concentration in surrounding areas. The results of heterogeneity analysis show that the SO₂ emission tax policy reform can produce a relatively more beneficial spatial spillover effect in eastern cities and higher administrative level cities, while the pollutants emission rights trading and the reform of NO_x emission tax rates can produce beneficial spatial spillover effects when cooperating with the reform of SO₂ emission tax rates. The results of the mediation effect analysis show that the higher SO₂ emission tax rate can aggravate the surrounding PM_2.5 pollution by promoting the aggregation level of industrial production factors and the industrial SO₂ emission intensity in the surrounding areas, which can support the existence of the pollution heaven effect.

Does pollution levy standard reform promotes green innovation? Evidence from China

Taking advantage of the quasi-natural experiment generated by the adjustment of pollution levy standard in different Chinese provinces and utilizing detailed prefecture-level data from 2004 to 2014, we rigorously examine the effect of an increase in pollution levy standard on green innovation by adopting the difference-in-differences method. We find that an increase in pollution levy standard can significantly promote regional green innovation, with a magnitude of nearly 12.8%, as compared with their control group. Additionally, we find that financial development and intellectual property protection tend to reinforce the positive effects. Our study suggests that the Chinese government should strengthen its institutional structure to promote green innovation.

The Impact of Foreign Direct Investment on Urban Green Total Factor Productivity and the Mechanism Test

This paper employs the slack-based model directional distance function to measure the green total factor productivity of each city, using the panel data of 284 prefecture-level cities in China from 2004 to 2019 and considering the unexpected output. The results are as follows: ① Foreign direct investment significantly suppresses the improvement of urban green total factor productivity, and the negative impact on the green technology progress index is the main reason to inhibit the increase of the green total factor productivity. The results are still significant through a series of robustness tests such as replacing variables and eliminating outliers; the positive intermediary effect of scientific and technological innovation exists, and the Sobel test and bootstrap random sampling test are passed. The upgrading of industrial structure has a positive regulating effect on the improvement of urban green total factor productivity. ② The impact of foreign direct investment on urban green total factor productivity has regional heterogeneity. The inhibitory effect of foreign direct investment on resource-based cities and non-coastal cities is greater than that on non-resource-based cities and coastal cities, and the negative impact on China-Europe train opening cities is greater than that on non-opening cities. Accordingly, the paper puts forward policy suggestions from the aspects of improving the quality of foreign direct investment and implementing differentiated management.

Can FDI facilitate green total factor productivity in China? Evidence from regional diversity

The development of foreign direct investment conforms to the theoretical principles of green total factor productivity and is key to promoting regional industry upgrading. Using three-stage data envelopment analysis (DEA) based on city-level data, this paper investigates the effect of foreign direct investment on regional green total factor productivity (GTFP) across China. The results show that foreign direct investment affects regional GTFP through technology spillover effect and human capital spillover effect. Under different environmental regulation intensity and marketization, the relationship between FDI and green total factor productivity is non-linear. The phenomena of "pollution paradise" and "bottom line race" survived at low marketization regional and foreign direct investment will inhibit the improvement of regional green total factor productivity in China.

Can digital finance boost SME innovation by easing financing constraints?: Evidence from Chinese GEM-listed companies

This paper summarizes the transmission chain of “digital finance-financing constraint-firm innovation” at the theoretical and practical levels, incorporates digital finance into the empirical analysis framework of firm innovation, selects the data of Chinese GEM(Growth Enterprise Market)-listed companies from 2011 to 2020, and matches the data of the digital inclusive finance index. The paper empirically examines the incentive effect and impact mechanism of digital finance on SME innovation through the two-way fixed-effects model and mediated-effects model by matching the data of China GEM-listed companies from 2011 to 2020 with the digital financial inclusion index data. The findings show that the digital development and promotion of digital finance play a significantly positive impact in helping SMEs innovate and stimulate innovation. The effect is realized by alleviating corporate financing constraints. Further, digital finance has different incentive effects on enterprises with varying rights of property nature, as well as on other regions.

Environmental Regulation Intensity, Foreign Direct Investment, and Green Technology Spillover—An Empirical Study

Many researchers have studied the relationships among heterogeneous foreign direct investment (FDI), environmental regulation, and green total factor productivity. However, no research has been done on how different types of FDI can result in green technology spillover under different levels of environmental regulation intensity. To address this research gap, in this paper, we build a static linear panel model, a static panel threshold model, and a dynamic panel threshold model to investigate the environmental regulatory threshold effect of labor-based FDI and capital-based FDI in terms of their green technology spillover. Based on the measurement of green total factor productivity (GTFP) of 36 industry sectors in China from 2003 to 2015, we first compare the threshold effects of environmental regulation on green technology spillover between labor-based FDI and capital-based FDI with a static linear model and a static threshold model. The results show that environmental regulation is unable to significantly promote the green technology spillover of labor-based FDI. However, intensifying environmental regulation can reduce the negative impact of labor-based FDI on GTFP. The effect of environmental regulation on green technology spillover of capital-based FDI is more complex. In the static linear model, environmental regulation can significantly promote the green technology spillover of capital-based FDI. In the static threshold model, the green technology spillover of capital-based FDI exists only when the environmental regulation intensity is sufficiently low or sufficiently high. Finally, the dynamic threshold model is adopted for robustness check. The results show when the environmental regulation intensity is higher than a threshold, both types of FDI can indeed result in green technology spillover. In short, our results prove that to ensure that FDI results in green technology spillover, it is necessary to continue to strengthen environmental regulation.