THE IMPACT OF CHINESE ENVIRONMENTAL REGULATIONS ON THE EFFECTIVENESS OF GREEN CREDIT POLICY: FROM THE PERSPECTIVES OF PROACTIVE GOVERNMENT AND EFFICIENT MARKET

Green credit is an important practice in China to facilitate enterprises' green transformation through market mechanisms, but its effectiveness remains controversial under the background of "shallow green" development.From the perspective of the synergistic effect between environmental regulations and green credit, this study takes A-share listed companies from 2009 to 2016 as samples, uses the "Green Credit Guidelines" in 2012 as a quasi-natural experiment, and uses the difference-indifferences method to analyze the policy's impact on green technological innovation of heavily polluting enterprises under different environmental regulation levels.It is found that the policy's effectiveness varies with environmental regulation levels: green credit crowds out enterprises' green technological innovation under weak regulations, but forces them to innovate under strong regulations.The conclusion is still valid after a series of robustness tests, and the policy's effects differ by enterprises' property rights, scale, and life cycle.Further tests reveal the green credit policy achieves the "strong Porter hypothesis" under high regulation level, while under weak regulation, heavily polluting enterprises tend to shift investment structures "from the real economy to the virtual economy".