How Does Regional Climate-Friendly Technology Innovation Affect Corporate Cash Holdings? Evidence from Chinese Listed Companies

Regional climate-friendly technology innovation (RCFTI) can reduce carbon emissions and lower the carbon risks faced by enterprises. This study investigates whether and how RCFTI influences corporate cash holdings. Using panel data on Chinese cities and A-share listed enterprises from 2008 to 2022, we find that RCFTI significantly reduces corporate cash holdings. RCFTI indirectly affects corporate cash holdings by reducing agency costs and increasing long-term real investment. Furthermore, the reduction is more pronounced among enterprises with high short-term debt and those located in financially underdeveloped regions.