How Does Venture Capital Affect Ecological Efficiency : Instrumental Variable Evidence Based on Government Guidance Fund
Based on the panel data of 191 prefecture-level cities in China from 2003 to 2016, we analyze how urban venture capital affects regional eco-efficiency. The empirical results show that the urban venture capital has a significant positive effect on the eco-efficiency level. After controlling the main economic variables, the time-fixed effect and the city-fixed effect, the total amount of urban venture capital increases by 1 million Yuan per year, the eco-efficiency index of the prefecture-level city increases by 0.0100 and 0.00308 respectively. After using government guidance fund as an instrumental variable to deal with potential endogeneity problems, the main findings are still robust. Further researches show that the impacts are illustrated to be heterogeneous at regional level, policy level, resource level and urban agglomeration level. Furthermore, we find that the urban venture capital can improve the regional eco-efficiency level mainly by promoting urban innovation, reducing pollutant emission and promoting industrial upgrading. Based on the empirical results, we propose that the government should pay full attention to the role of financial factors in the construction of ecological civilization system and environmental governance system, expand the positive impact of venture capital by encouraging innovation and industrial upgrading, and try to eliminate the financial barriers in the development of green technology
Year of publication: |
[2023]
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Authors: | Li, Linyue ; Yang, Chen |
Publisher: |
[S.l.] : SSRN |
Saved in:
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