Spatial spillovers and threshold effects of internet development and entrepreneurship on green innovation efficiency in China

Green innovation is a critical component of high-quality development that is particularly integrated with the Chinese 14th five-year plan. At present, internet development and entrepreneurship are considered to be the important driving forces to improve green innovation efficiency adhered by sustainable development goals. Thus, based on the panel of 30 provincial administrative regions in China from 2006 to 2018 and 196 cities from 2012 to 2018, the spatial spillover, threshold effects, causality of Internet development on green innovation efficiency (GIE) are comprehensively investigated. The results reveal that internet development and entrepreneurship have a positive effect on the GIE. This conclusion is still valid after a series of tests of robustness including iv estimation. There are also significant spatial spillover effects among internet development, entrepreneurship, and GIE. For instance, the local internet development and entrepreneurship can significantly strengthen the green innovation efficiency of neighboring regions in China. The threshold model reveals that advancement in regional entrepreneurship lifts the positive impact of internet development on GIE. Manifestly, the development of Internet and entrepreneurship have a marginal increasing non-linear impact on the GIE, that significantly varied across different thresholds of both variables. Taking broadband China as a quasi-natural experiment, this paper tests the causality between the development of Internet and the efficiency of green innovation. The results show that the broadband China policy has significantly promoted the efficiency of green innovation. These research findings offer valuable policy recommendations for government and stakeholders.