Catalyzing Green Innovation: The Role of Green Finance in Sustainable Development

Utilizing China’s Green Finance Reform and Innovation Pilot Zone (GFRIP) policy as a quasi-natural experiment, we investigate the impact of green finance on green innovation. Analyzing data from publicly listed companies from 2010 to 2020, our study finds that the number of green patents in GFRIP regions exceeds those in other regions by 33.1%. Additionally, the GFRIP policy demonstrates anticipatory, long-term, and spillover effects on the number of corporate green innovations. The policy’s impact is more pronounced in economically developed regions, ecologically resource-rich areas, and among private enterprises. Furthermore, the GFRIP policy enhances corporate environmental behavior, alleviates corporate financing constraints, and boosts corporate R&D investment.