Booster or Stumbling Block? The Role of Environmental Regulation in the Coupling Path of Regional Innovation under the Porter Hypothesis

In the 2018 Global Environmental Performance Index, China’s global air quality rank was fourth from last, indicating a more pronounced conflict between the environment and development compared with other countries. Because of the vastness of China’s land area, the development of different regions is imbalanced. The achievement of the stipulated goal to be among the top innovative countries in the world by 2035 not only depends on the economically developed eastern part of China but also on the relatively economically underdeveloped central, western, and northeastern parts. In this context, this paper uses time-varying qualitative comparative analysis to explore how the coupling paths of environmental regulation affect regional innovation. The results show that: (1) In most cases at the overall level of China, the Porter hypothesis is supported, and environmental regulation can play the role of a “booster” and stimulate regional innovation. In a few cases, however, the Porter hypothesis is not supported. (2) The Porter hypothesis is also supported in most cases at the regional level, where environmental regulation is mostly a “booster” for regional innovation in the east, center, west, and northeast. (3) Comparison of regional heterogeneity shows that environmental regulation is more important for stimulating regional innovation in the east than in the center, west, and northeast. This study helps to identify the role of environmental regulation in regional innovation. Moreover, it also helps to understand the emphasis China placed on environmental management during the early stages of its economic development.