Climate Policy Uncertainty and Corporate Green Innovation Bubbles, Promote Or Inhibit?

Ziyuan Wang; Xueying Meng

doi:10.6981/FEM.202504_6(4).0025

Authors

Ziyuan Wang
Xueying Meng

DOI:

https://doi.org/10.6981/FEM.202504_6(4).0025

Keywords:

Climate Policy Uncertainty; Corporate Green Innovation Bubbles; Financial Slack.

Abstract

Climate policy uncertainty creates operational difficulties for enterprises while also containing potential opportunities. Corporate green innovation, serving as a crucial tool for environmental governance and sustainable development promotion, requires coordination between quality and quantity to ensure its practical effectiveness. The phenomenon of "quantity over quality" has become a verified reality in current corporate green innovation. By analyzing panel data from China's A-share listed companies during 2012-2023, this paper systematically examines the consequence of shocks from climate policy fluctuations on corporate green innovation bubbles while investigating its underlying mechanisms. The study finds that increased climate policy fluctuations significantly intensify corporate green innovation bubbles, whereas financial slack can effectively mitigate this phenomenon. This paper enriches the research system of climate policy uncertainty on corporate innovation behavior, and provides a solution for enterprises to alleviate green innovation bubbles in the face of climate policy fluctuations.

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