Zhen YU, Chenxi LI, Yuankun LI
Under the orientation of high-quality development, the incentive problem for green transformation of Chinese enterprises urgently needs to be solved. From the perspective of regional trade agreements (RTAs), we construct a theoretical model to analyze the impact mechanism of "Open Environmental Regulations" on the green technology progress of enterprises in developing countries, and conduct an empirical study taking Chinese enterprises as an example. First, we develop a model of enterprise green innovation decision-making in an open economy and find that RTAs' environmental provisions influence the direction of enterprise technological progress through two channels: The technological incentive effect and product structure effect. Then, using the text of RTAs, country-specific bilateral trade data, and import and export data from Chinese customs, we construct the "environmental provisions embeddedness" of enterprises and employ a panel fixed-effects model to empirically test the effect of "Open Environmental Regulations" on green technological progress in Chinese enterprises. Our study finds that embedded environmental provisions significantly promote substantive green innovation in enterprises but have no significant impact on strategic green innovation. Mechanism analysis shows that RTAs' environmental provisions drive enterprises to increase R&D investment and green transformation of product structures, thereby promoting green technological progress. The green innovation effect of environmental provisions is more evident in non-heavy polluting industries, enterprises with low financing constraints, enterprises with high social attention, and enterprises with a high degree of overseas market diversification. Further research finds that some market-based environmental regulation tools amplify the green innovation effect of environmental provisions, indicating the necessity of coordinating internal and external environmental policies in the process of institutional openness. These conclusions provide new theoretical perspectives and empirical evidence for China to promote high-quality economic development and high-level environmental protection through high-level openness. Our study finds that embedded environmental provisions significantly promote substantive green innovation in enterprises but have no significant impact on strategic green innovation. Mechanism analysis shows that RTAs' environmental provisions drive enterprises to increase R&D investment and green transformation of product structures, thereby promoting green technological progress. The green innovation effect of environmental provisions is more evident in non-heavy polluting industries, enterprises with low financing constraints, enterprises with high social attention, and enterprises with a high degree of overseas market diversification. Further research finds that some market-based environmental regulation tools amplify the green innovation effect of environmental provisions, indicating the necessity of coordinating internal and external environmental policies in the process of institutional openness. These conclusions provide new theoretical perspectives and empirical evidence for China to promote high-quality economic development and high-level environmental protection through high-level openness.