E-Commerce Development and Green Technology Innovation: Comparison
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Green technology innovation (GTI) is critical for economic development and environmental protection. This paper investigates the influence of the National E-commerce Demonstration Cities (NEDC) policy on GTI using a multi-period Difference-in-Difference (DID) model and data from prefecture-level Chinese cities. The findings indicate that the NEDC policy considerably facilitates GTI in China. The conclusion withstands a comprehensive set of robustness tests and remains valid even after considering potential endogeneity issues. A dynamic analysis reveals an increasing influence of the NEDC policy on GTI over time. The paper identifies producer services agglomeration, internet development, and financial support as channels through which the NEDC policy affects GTI. A heterogeneity anaheterogeneity analysis demonstrates that the NEDC policy’s influence on GTI is more pronounced in larger cities with a higher degree of marketization and increased levels of human capital. Moreover, the NEDC policy exhibits spatial spillover effects, supporting GTI advancement in both local cities and neighboring regions. This study provides insights into how emerging market economies can leverage e-commerce for green development.

  • green technology innovation (GTI)
  • National E-commerce Demonstration Cities (NEDC) policy

1. Introduction

Resource depletion and environmental issues have gained prominence recently [1], posing a severe threat to human life. It has become a global concern to ensure the sustainable growth of human society within natural restrictions [2]. The supply chains have become extremely volatile in recent years due to various crises and shocks [3,4][3][4]. China’s rapid industrialization and urbanization have brought about severe ecological and environmental problems while achieving leaps and bounds in economic development [5,6,7,8][5][6][7][8]. China’s economic growth, resources, and environment are under severe pressure, and green development is imperative [9], with many efforts in recent years tackling the “green” themes from various perspectives, such as green finance [10,11][10][11] and green purchase intention [12,13][12][13].
Green technology innovation (GTI) attempts to increase the effectiveness of resource usage and decrease pollution emissions during production. It serves as the primary strategy for addressing the issue of global environmental pollution and achieving sustainable growth [14,15,16][14][15][16].
With the profound integration of digital technology and the real economy, the digital economy has grown exponentially and has been considered a new engine of global economic development. The value of the digital economy in 47 nations in 2018 was 30.2 trillion U.S. dollars, or an average of 40.3% of GDP. In 2021, the cost of a digital economy across 47 countries was 31.8 trillion U.S. dollars, accounting for 45.3% of GDP on average [17]. The development of the digital economy boosts the degree of economic openness, optimizes the industrial structure, and expands the market potential, thus facilitating GTI [18]. It is now a vital driving force for the promotion of GTI [19,20,21,22][19][20][21][22]. As an essential component of the digital economy, e-commerce also develops rapidly. The value of the global e-commerce market exceeded 3.8 trillion U.S. dollars in 2021 [17]. According to the China Internet Development Report (2021), China’s e-commerce transactions totaled $37.21 trillion in 2020.
The rapid development of e-commerce benefited from the strong support of the National E-commerce Demonstration Cities (NEDC) policy [23]. The central objectives of the NEDC policy are to furnish the necessary infrastructure and foster an advantageous environment for e-commerce growth, with a primary focus on minimizing energy consumption and propelling green economies. The central government established the first pilot zone in Shenzhen to explore a more suitable e-commerce development mode for China in September 2009. The program expanded in 2011 to include Beijing and 21 National E-commerce Demonstration Cities (NEDC) pilot cities. By 2014, the initiative had extended to Dongguan and another 29 NEDC pilot cities. By 2017, the program encompassed a total of 71 cities. Figure 1 shows the distribution of the NEDC pilot cities.
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Figure 1.
Distribution of the NEDC pilot cities.
E-commerce provides enterprises from developing countries access to international markets [24]. It can reduce transaction costs [25], increase the scope and frequency of contact between enterprises and their stakeholders, and facilitate resource integration and knowledge spillover. Previous studies emphasized the driving factors of e-commerce development based on a sample of developed countries [26,27][26][27] and their influence on carbon emissions and environmental pollution [28,29,30][28][29][30]. The influence of e-commerce on GTI is rarely studied. Li [31] demonstrated that the NEDC policy promotes GTI, and the concentration of scientific and technological talents can further enhance this positive effect. However, the mechanism by which the NEDC policy promotes GTI remains to be determined.
Furthermore, the digital economy has an apparent spatial correlation [18,32][18][32]. It can provide favorable external conditions for the cross-regional flow of innovative factors such as knowledge and talent, facilitating the optimal allocation of innovation resources across regions.

2. E-Commerce Development and Green Technology Innovation

Due to high investment costs, long investment return times, and high risk, enterprises are reluctant to pursue green innovation [35][33]. Environmental protection subsidies, R&D subsidies, and talent subsidies encourage enterprises to increase their R&D investment, enhancing their GTI [36][34]. Environmental regulation is one of the critical factors driving GTI [37,38,39,40][35][36][37][38]. However, there has yet to be an agreement on how green technology innovation and environmental legislation are related [41][39]. The first perspective holds that environmental regulation raises the expenses associated with environmental compliance for businesses, impeding their desire and capacity for innovation and, as a result, impeding their green innovation [42,43][40][41]. The Porter Hypothesis, the second point of view, contends that more rigorous but carefully designed environmental regulations can spur business innovation, which could then wholly or partially offset the cost of compliance and encourage the development of green technologies. Peng et al. [44][42] demonstrate that environmental legislation boosts green innovation intention, and green innovation intention encourages green innovation activity. As a market-based environmental regulation, green credit policy stimulates green innovation in highly polluting industries [45][43]. Gao et al. [46][44] discover that appropriate command-control environmental regulations and high-intensity market-oriented environmental regulation promote GTI. The digital economy is an essential factor influencing GTI. Digital infrastructure can improve informatization, increase media attention, and improve corporate governance, thus stimulating corporate green technology innovation [19,21][19][21]. Industrial internet platforms promote green innovation [47][45]. Chin et al. [20] find that blockchain technology favors green innovation performance, with value appropriation capacity acting as a moderator. By encouraging producer service agglomeration, accelerating financial growth, and lowering resource dependence, internet development can considerably improve urban green innovation efficiency in China [48][46]. Digitally inclusive finance can reduce corporate funding limitations while improving internal governance and promoting innovation in green technology [49][47]. Chen et al. [50][48] reveal that the digital transformation of nations’ economies can promote green technology innovation by improving internal controls and financing opportunities. E-commerce is becoming increasingly important to the world economy and has become a crucial engine for the growth of the global economy [51][49]. Oliner and Sichel [52][50] first investigate the effects of e-commerce on U.S. productivity from 1996 to 1999 using the “back-of-the-envelope” calculation approach. The productivity of businesses can be significantly increased by e-commerce, according to several empirical studies [53,54][51][52]. Cao et al. [23] verify that China’s pilot policy of National E-commerce Demonstration Cities (NEDC) can improve green total factor productivity, with industrial structure upgrading, non-production cost reduction, and green innovation incentives being the fundamental mechanisms. Rural e-commerce can raise rural household income and the volume of online commodity transactions [55,56][53][54] and considerably reduce poverty [57][55]. E-commerce is also thought to have the potential to be economical and energy-saving. Taking Shenzhen as an example, Zhao et al. [58][56] demonstrate that the environmental cost of traditional retail is higher than e-commerce, and the increase in the proportion of e-commerce will help to reduce the overall retail-induced carbon emissions. Both Dong et al. [34][57] and Wang et al. [30] report that the NEDC pilot program reduces carbon emissions through resource allocation optimization, energy consumption reduction, industrial structure upgrading, and technical innovation based on data from the Chinese urban panel. Through marginal income enhancement, mechanization, and labor transfer, Ji et al. [59][58] find that China’s rural E-Commerce Demonstration County (REDC) strategy reduces the amount of chemical fertilizer sprayed in the county by 21%.

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