Green finance and enterprise green innovation: incentive effect and synergy perspective

This article proposes a difference-in-differences empirical research framework that utilizes the Green Financial Reform and Innovation Pilot Zone (GFRIPZ) implemented in China in 2017 as an exogenous shock to identify the incentive and synergy effect of green finance (GF) on enterprise green innovation (GI). The results indicate that GF effectively stimulates enterprise GI and significantly influences the allocation of external and internal funds among industries. GF effectively stimulates GI in clean and non-polluting industries by increasing debt financing and productive investment. However, it has a punitive effect on debt financing of heavy-polluting industries, and the GI effect on heavy-polluting industries is insignificant, although it enhances R & D investment among industries. GF can produce a good synergistic effect with green policies, but the synergistic effect on non-green policies is not obvious. GF mainly promotes GI in non-state, big, and enterprises in areas with high marketization. Moreover, only the heavy pollution industry presents significant environmental performance.