Unravelling the impact pathways of green innovation and environmental regulation on China’s green development efficiency goals: Direct and spillover effects

Abstract

• The GI, ER, and its synergies were validated in facilitating China’s GDE goals. • Applied the super-efficient SBM-DEA model to calculate the GDE in provincial areas. • Geographical clustering and variability existed in the GDE within China. • The spatial Durbin model illustrated the salience of indirect effects in GI and ER. • The spatial spillover effects of GI and ER improved the GDE in neighboring areas. Despite the worldwide effort to decarbonize societies by implementing green innovation (GI) and environmental regulation (ER) to advance the agenda for sustainable development, a comprehensive theoretical framework covering temporal, spatial, and regional heterogeneity analysis for China still needs to be developed. This paper utilizes the Super-efficiency SBM-DEA and spatial econometric model to evaluate the impact of GI and ER on green development efficiency (GDE) using data from 30 Chinese mainland provinces divided into three regions (east, central, and west) from 2005 to 2021. The data reflected an evolutionary trend from the east to the interior regions, where GI and CO 2 emissions levels decreased initially, but later increased over time. The GDE in different provinces had a significant spatial correlation, indicating the spatial agglomeration of high and low-efficiency regions. Furthermore, the spatial analysis showed that GI positively impacts GDE in the local region through technological mobility, whereas ER relies on the transfer of pollutants to improve ecological conditions in neighboring areas. Finally, the decomposition effects indicated that GI, moderated by environmental regulation, continued to be a driver of GDE and was more prominent in the spillover effects. The study suggests that the government should promote innovation support, develop regulatory systems, initiate regional environmental co-governance programs, and institutionalize green development to meet GDE goals.