Antitrust laws, market competition and corporate green innovation

Abstract

Utilizing a dataset from 2003 to 2016 encompassing Chinese firms listed on the A-share market, the current study conducts a robust analysis through a quasi-experimental approach, focusing on the enforcement of the Anti-Monopoly Law in 2008. By employing the Difference-in-Differences (DID) technique, it delves into the profound connections between anti-monopoly laws, market competition, and corporate green innovation. The rigorous enforcement of anti-monopoly laws has inhibited green innovation in enterprises with stronger original monopoly power, reducing the green innovation performance gap between them and enterprises with weaker monopoly power. Moreover, the study reveals that anti-monopoly regulations bolster the occurrence of green innovation by intensifying market competition, driving companies to pursue distinct competitive edges. The analysis further suggests that the negative impact of anti-monopoly laws on eco-innovation is more significant in state-controlled enterprises and in sectors with pronounced monopolistic traits that are not technology-intensive. This scholarly work not only contributes to the academic discourse on the nexus between anti-monopoly legislation and corporate inventive endeavors but also equips policymakers with tangible insights into leveraging legal frameworks to foster environmentally sustainable corporate innovation.