Government Environmental Protection Expenditure and Regional Green Innovation: The Moderating Role of R&D Element Flow in China

Local governments assume the crucial responsibility of advancing regional environmental regulation and protection and fostering green innovation in development. This paper takes the provincial-level data from 2007 to 2018 in China, and investigates how government environmental protection expenditure (GEPE) influences regional green innovation. Also, a gravity model is constructed to figure out R&D element flow, and the moderating mechanisms of the flow of R&D personnel and R&D capital are further examined. The empirical evidence shows that GEPE significantly promotes regional green innovation (coefficient = 0.185, p < 0.01), with robustness confirmed through lagged effect tests, indicating sustained positive impact. Mechanism analysis indicates that R&D personnel flow significantly strengthens the positive effect of GEPE on regional green innovation (interaction coefficient = 0.016, p < 0.01), while the moderating effect of R&D capital flow is statistically insignificant. The spatial Durbin model further confirms that the impact of GEPE on green innovation has a spatial spillover effect in neighboring regions. Additionally, excessive environmental decentralization suppresses the positive influence of GEPE on regional green innovation. These findings provide empirical evidence for local governments to promote regional green innovation through fiscal expenditures. It emphasizes the necessity of giving full play to the guiding and “leveraging” role of government environmental governance expenditure while fostering a synergistic effect between government environmental protection expenditure and the free flow of R&D elements, ultimately promoting coordinated green development in regions.