Research On The Impact Of New Environmental Protection Law Implementation On Enterprise Innovation

Since the reform and opening up,China has made great achievements in economic construction,but while economic development,ecological environmental protection has been disregarded,and China’s ecological environment has been greatly damaged.The New Environmental Protection Law implemented on January 1,2015 has a significant impact on China’s economy and ecological civilization.After the implementation of the new environmental protection law,the environmental situation in China has been greatly improved,while China is at an important stage of development towards high quality,and innovation has become a driving factor for economic development.There is no uniform conclusion on whether the implementation of the new environmental protection law has promoted corporate innovation and thus high quality economic development.Therefore,this paper examines the impact of the implementation of the new environmental laws on corporate innovation.This paper firstly summarises the existing literature on environmental regulation and innovation,and secondly,based on the existing research findings on the relationship between different types of environmental regulation and innovation,it measures the technological innovation of enterprises in terms of R&D investment and directly measures the intensity of environmental regulation using the New Environmental Protection Law as a regulatory policy,and accordingly proposes a research hypothesis to test whether Porter’s hypothesis is valid.Furthermore,a large number of studies have shown that environmental regulation has a heterogeneous impact on firm innovation,so the differences in the impact of the implementation of the new environmental law on innovation among firms in different capital markets are further investigated.To investigate the above,this study uses annual data of 2,440 firms listed on the Shanghai and Shenzhen exchanges A-shares from 2010 to 2020 as the benchmark sample.A propensity score-double difference distribution(PSM-DID)was used to test the net effect of the implementation of the new EPA policy on the impact of corporate technological innovation by using a one-to-one matching of the initial research sample followed by a double difference test.The empirical results show that the implementation of the new environmental protection law has a significant incentive effect on enterprise technological innovation,which can improve the innovation ability of enterprises,supporting the Porter hypothesis,indicating that the environmental regulation policy has a positive effect on enterprise technological innovation in China;furthermore,the implementation of the new environmental protection law has a heterogeneous effect on enterprises in different capital markets:its Further,the implementation of the new environmental law has a heterogeneous effect on firms in different capital markets:it can positively promote the technological innovation of GEM-listed firms,in line with the Porter hypothesis,while it has a weakening effect on the technological innovation of Main Board-listed firms,which supports the traditional economic view,indicating that this environmental regulation has different effects on different corporate entities.