Does Green Credit Affect the Green Innovation Performance of High-Polluting and Energy-Intensive Enterprises? Evidence from A Quasi-Natural Experiment

Abstract Green credit policy is a practical exploration to guide green development through the allocation of financial resources, but there is a gap in the theoretical research on how green financial policy affects enterprise green technology innovation. Taking the green credit policy in 2012 as a quasi-natural experiment, this paper applies the methods of Propensity Score Matching and Difference in Difference (PSM-DID) to investigate the relationship between green credit policy and enterprises' green technology innovation behavior based on Chinese industrial enterprises database and green patent database. The results show that the implementation of "green credit guidelines" policy has significantly improved the green innovation output of high-polluting and high-energy consuming enterprises, which indicates that the incentive effect of green credit policy on enterprises exceeds the inhibition effect and leads to Porter effect. Moreover, the green credit policy has significantly increased the number of non-invention patents rather than invention patents. In addition, the green credit policy has a more significant effect on the innovation output of heavily polluting enterprises in state-owned and weak market power enterprises. Mechanism test shows that green credit policy mainly affects the green innovation output of heavy polluting enterprises by guiding the loan financing cost and R&D investment allocation.