Impacts of Green Innovation, Institutional Constraints and Their Interactions on High-Quality Economic Development across China

Abstract

In 2015, China put forward five development concepts, propounded the concept of green development and green innovation, and adhered to the road of sustainable development. China also promoted the vision of high-quality economic development in 2017. It is very important to study the impacts of green innovation on high-quality development. However, scant research has been conducted on the impact of green innovation and institutional constraints on high-quality economic development simultaneously over both space and time in China. In this study, we analyze the impacts of green innovation on high-quality economic development across China from 2014 to 2018. The panel data model and the panel threshold model are developed, and the impact of green innovation and institutional constraints on high-quality economic development is empirically analyzed. Our results indicate that the comprehensive index and the level of high-quality economic development in all regions of China are increasing consistently. At the national level, addressing green innovation and institutional constraints have shown a significant positive impact on high-quality economic development. At the regional level, the interaction of green innovation and institutional constraints (i.e., mitigation of institutional constraints by green revolution) has a more positive impact on the economic quality of eastern China than that of central China. The interaction between green innovation and institutional constraints shows no positive impact on the high-quality economic development of the central and western regions because the green innovation, institutional constraints, and economic development in the central and western regions are weaker than those in the eastern regions. Therefore, it is suggested that different regions of China, especially the central and western ones, should strengthen green innovation, improve the market system, and increase government support.