Carbon Emissions Trading and Corporate Green Technology Innovation

Green technology innovation is the cornerstone of achieving green and high-quality development and an important guarantee for China to achieve the goals of "carbon neutrality" and "carbon emission reduction". As a market-oriented environmental policy, the carbon emission trading policy can affect the behavior of enterprises, and its impact on green technology innovation of enterprises deserves in-depth study. Based on the green patent data of A-share listed companies from 2008 to 2021, taking the carbon trading pilot policy as a quasi-natural experiment, this paper establishes a multi-point difference-in-differences model to explore the impact of carbon trading policy on green technology innovation of enterprises and discusses the regulatory role from the perspective of the carbon price, carbon market liquidity, and carbon market size. Finally, we also conduct a heterogeneity analysis based on the differences in the micro-characteristics of enterprises. The results show that the carbon trading policy significantly promotes the green technology innovation activities of enterprises; The role of carbon emission rights in facilitating enterprises to expand their green technology innovation is stronger for those with higher carbon price, as well as larger carbon trading scale. The market mechanism measured by the liquidity of the carbon market partially explains the promotion role of green technology innovation. Further heterogeneity analysis shows that the promotion effect of carbon trading policy on green technology innovation is mainly reflected in non-high-tech enterprises, low-carbon enterprises, and enterprises with high internal control quality. Therefore, we should give play to the incentive role of the carbon price and carbon trading scale, optimize the design of the carbon market system, provide targeted green innovation support for enterprises, and help to achieve carbon emission reduction and green high-quality development.