Does capital market opening promote enterprise green innovation? Evidence from Shanghai-Hong Kong stock connect and Shenzhen-Hong Kong stock connect
Abstract
This study selects Chinese A-share listed enterprises from 2010 to 2020 as the research sample, constructs a Difference-in-differences model to analyze the Shanghai-Hong Kong stock connect and Shenzhen-Hong Kong stock connect policy on enterprise green innovation. The transmission channels are tested, and the heterogeneity of this impact is further explored. It is found that the Shanghai-Hong Kong stock connect and Shenzhen-Hong Kong stock connect policy has significantly improved the total level, quality and quantity of enterprise green innovation, and the effect on the total level and quality is greater than the quantity. The Shanghai-Hong Kong stock connect and Shenzhen-Hong Kong stock connect policy can effectively alleviate the financing constraints faced by enterprises, improve the information environment of enterprises, and thus improve their green innovation. There is heterogeneity in the nature of property rights, corporate social responsibility, industry monopoly and regional marketization in the promotion of enterprise green innovation by the Shanghai-Hong Kong stock connect and Shenzhen-Hong Kong stock connect policy.
First published online 21 July 2023
Keyword : capital market opening, enterprise green innovation, financing constraint, information environment
How to Cite
Lyu, Y., Wang, Z., & Zhang, J. (2023). Does capital market opening promote enterprise green innovation? Evidence from Shanghai-Hong Kong stock connect and Shenzhen-Hong Kong stock connect. Technological and Economic Development of Economy, 29(5), 1432–1460. https://doi.org/10.3846/tede.2023.19424
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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Fernandes, N., & Ferreira, M. A. (2008). Does international cross-listing improve the information environment. Journal of Financial Economics, 88(2), 216–244. https://doi.org/10.1016/j.jfineco.2007.06.002
Ferreira, M. A., & Matos, P. (2008). The colors of investors’ money: The role of institutional investors around the world. Journal of Financial Economics, 88(3), 499–533. https://doi.org/10.1016/j.jfineco.2007.07.003
Fiorillo, P., Meles, A., Mustilli, M., & Salerno, D. (2022). How does the financial market influence firms’ Green innovation? The role of equity analysts. Journal of International Financial Management & Accounting, 33(3), 428–458. https://doi.org/10.1111/jifm.12152
Guoyou, Q., Saixing, Z., Chiming, T., Haitao, Y., & Hailiang, Z. (2013). Stakeholders’ influences on Enterprise Green Innovation strategy: A case study of manufacturing firms in China. Corporate Social Responsibility and Environmental Management, 20(1), 1–14. https://doi.org/10.1002/csr.283
Harford, J., Jiang, F., Wang, R., & Xie, F. (2019). Analyst career concerns, effort allocation, and firms’ information environment. The Review of Financial Studies, 32(6), 2179–2224. https://doi.org/10.1093/rfs/hhy101
Hsu, P. H., Tian, X., & Xu, Y. (2014). Financial development and innovation: Cross-country evidence. Journal of Financial Economics, 112(1), 116–135. https://doi.org/10.1016/j.jfineco.2013.12.002
Huang, L., & Lei, Z. (2021). How environmental regulation affect corporate green investment: Evidence from China. Journal of Cleaner Production, 279, 123560. https://doi.org/10.1016/j.jclepro.2020.123560
Jagannathan, R., Ravikumar, A., & Sammon, M. (2017). Environmental, social, and governance criteria: Why investors are paying attention (Working Paper No. 24063). National Bureau of Economic Research. https://doi.org/10.3386/w24063
Jensen, M. C., & Meckling, W. H. (2019). Theory of the firm: Managerial behavior, agency costs and ownership structure. In Corporate Governance (pp. 77–132). Gower.
Kacperczyk, M., Sundaresan, S., & Wang, T. (2021). Do foreign institutional investors improve price efficiency? The Review of Financial Studies, 34(3), 1317–1367. https://doi.org/10.1093/rfs/hhaa076
Kaplan, S. N., & Zingales, L. (1997). Do investment-cash flow sensitivities provide useful measures of financing constraints? The Quarterly Journal of Economics, 112(1), 169–215. https://doi.org/10.1162/003355397555163
Kim, J. B., & Cheong, H. Y. (2015). Foreign versus domestic institutional investors in emerging markets: Who contributes more to firm-specific information flow? China Journal of Accounting Research, 8(1), 1–23. https://doi.org/10.1016/j.cjar.2015.01.001
Laeven, L. (2003). Does financial liberalization reduce financing constraints? Financial Management, 5–34.
Lai, H., Wang, F., & Guo, C. (2022). Can environmental awards stimulate corporate green technology innovation? Evidence from Chinese listed companies. Environmental Science and Pollution Research, 29(10), 14856–14870. https://doi.org/10.1007/s11356-021-16632-1
Lang, M. H., Lins, K. V., & Miller, D. P. (2003). ADRs, analysts, and accuracy: Does cross listing in the United States improve a firm’s information environment and increase market value? Journal of Accounting Research, 41(2), 317–345. https://doi.org/10.1111/1475-679X.00106
Li, Q., Liu, X., Chen, J., & Wang, H. (2022). Does stock market liberalization reduce stock price synchronicity? – Evidence from the Shanghai-Hong Kong Stock Connect. International Review of Economics & Finance, 77, 25–38. https://doi.org/10.1016/j.iref.2021.09.004
Li, Y. H., & Huang, J. W. (2017). The moderating role of relational bonding in green supply chain practices and performance. Journal of Purchasing & Supply Management, 23(4), 290–299. https://doi.org/10.1016/j.pursup.2017.06.001
Li, Y., Zhang, J., & Lyu, Y. (2023). Toward inclusive green growth for sustainable development: A new perspective of labor market distortion. Business Strategy and the Environment, 1–24. https://doi.org/10.1002/bse.3346
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