How does environmental punishment affect regional green technology innovation?—Evidence from Chinese Provinces

PLOS ONE RESEARCH ARTICLE How does environmental punishment affect regional green technology innovation?— Evidence from Chinese Provinces Wei Wang1, Jie Wen1, Zhigao Luo ID1,2*, Wenyi Luo3 1 School of Finance, Chongqing Technology and Business University, Chongqing, China, 2 Research Center for Economy of Upper Reaches of the Yangtze River, Chongqing Technology and Business University, Chongqing, China, 3 School of Business Administration, Chongqing Technology and Business University, Chongqing, China a1111111111 a1111111111 a1111111111 a1111111111 a1111111111 OPEN ACCESS Citation: Wang W, Wen J, Luo Z, Luo W (2023) How does environmental punishment affect regional green technology innovation?—Evidence from Chinese Provinces. PLoS ONE 18(7): e0288080. https://doi.org/10.1371/journal. pone.0288080 Editor: Vincenzo Basile, University of Naples Federico II: Universita degli Studi di Napoli Federico II, ITALY Received: February 26, 2023 Accepted: June 19, 2023 Published: July 21, 2023 Copyright: © 2023 Wang et al. This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited. Data Availability Statement: All relevant data are within the paper and its Supporting information files. Funding: This research was supported by Humanities and Social Sciences Youth Grant of the Ministry of Education (China) (No. 19YJC790144); Chongqing Technology and Business University High-level Talents Research Project(No. 2153013). The funders had no role in study design, data * Abstract As an important means of environmental regulation, environmental punishment lacks in empirical evidence on its impact on regional green technology innovation in China. Based on panel data of 30 provinces in China from 2010 to 2020, this paper systematically examines the relationship between environmental punishment and regional green technology innovation. It is found that environmental punishment has the quantity and quality enhancing effects on regional green technology innovation, and the quantity enhancing effect is greater than the quality enhancing effect. There is no significant effect difference between monetary punishment and non monetary punishment on green technology innovation effect, but the effect of punishment on institutions is obviously greater than that of punishment on individuals. And the performance of ecological provinces and provinces with better legal environment is also relatively better. Environmental punishment enhances the quantity and quality of green technology innovation through pressure, and improves the quality of green technology innovation through deterrence. Besides, in China, deterrence promotes regional green technology innovation together with the Central Government’s environmental protection inspection, the national green manufacturing strategies and other policies concerned. 1. Introduction At present, global environmental problems are becoming increasingly acute, and carbon peaking and carbon neutrality have become a worldwide hot topic. Green technology innovation is one of the core themes of World City Day just held in Shanghai in 2022. And in the 14th FiveYear Plan and the 2035 Vision Outlines, China swears to build a market-oriented green technology innovation system. In the western countries, market-oriented environment regulation is playing the major rule in the environmental governance. While in China which is characterized of hierarchy bureaucratic governance, environmental punishment is an important means of environmental regulation, which is conducive to regional green transformation and enterprise green technology innovation [1]. China revised Measures for Environmental Administrative Penalties twice in 2010 and 2022. In 2015, Measures for Daily Continuous Penalties PLOS ONE | https://doi.org/10.1371/journal.pone.0288080 July 21, 2023 1 / 18 PLOS ONE collection and analysis, decision to publish, or preparation of the manuscript. Competing interests: The authors have declared that no competing interests exist. How does environmental punishment affect regional green technology innovation? Implementation is issued by the environmental protection authorities, which was revised in 2017 (but no revised version has been released so far). According to the manual statistics of the administrative penalties disclosed by the national environmental protection department, since 2010, China has disclosed as many as 520000 environmental administrative penalties. So, how does such frequent environmental punishment affect regional green technology innovation? What is the mechanism behind it? In the previous research, scholars mainly focus on the relationship between environmental regulation and green technology innovation, as well as the impact of environmental punishment. As green technology innovation has the positive externalities of innovation spillovers and pollution emissions have the negative externalities, these dual externalities will lead market failure and inhibit the green innovation of enterprises [2]. Therefore, environmental regulation is indispensable to improve the efficiency of green technology innovation [1]. Relevant empirical studies indicate that reasonable and appropriate environmental regulation will force enterprises to carry out environment-friendly technological innovation, which will significantly promote the innovation of high-tech equipments and green products [3]. This is consistent with the Porter Hypothesis. While some scholars also believe that environmental regulation will increase the production cost of enterprises, reduce the profit of enterprises, and decrease the green technology innovation incentive of enterprises [4]. In fact, different types of environmental regulations may cause differences in enterprises’ green innovation behaviors. For example, command and control environmental regulation usually makes enterprises’ green technology innovation investment increase first and then decrease, while environmental regulation based on market and public participation will promote enterprises to increase green technology innovation investment after a period of time. Therefore, there may be an inverted U-shape relationship between environmental regulation and green technological innovation [5, 6], or a definite U-shape relationship [7, 8]. In addition, green technology innovations also differ in size and quality, on which the effects of environmental regulation differ [9]. Environmental punishment is an essential policy tool of environmental regulation, aiming to reduce environmental pollution, ecological damage and other illegal acts, so as to implement the national environmental policy [10]. However, in practice, environmental punishment is often considered to be a double-edged sword, which is mainly reflected on the micro level. On the one hand, environmenta (...truncated)