Maximizing green innovation: the impact of government subsidies and R&D in digital supply chains

PurposeThis research examines the relationship between green innovation and firm performance, focusing on identifying the moderating effects of government subsidies and digital transformation R&D investments. The study aims to provide insights on how firms can leverage green innovation for enhanced performance while addressing potential drawbacks.Design/methodology/approachThis study adopts a mixed-methods approach, utilizing both analytical models and empirical analyses. It investigates the curvilinear relationship between green innovation and firm performance and explores the moderating roles of government subsidies and digital transformation R&D investments.FindingsThe findings reveal an inverted U-shaped relationship between green innovation and firm performance, indicating that initial investments in green innovation led to performance improvements, but beyond a certain point, the returns diminished. The study also finds that government subsidies and digital transformation R&D investments significantly enhance the positive impact of green innovation up to the optimal threshold and help mitigate negative effects.Practical implicationsThe research provides practical guidance for firms on managing their green innovation investments to maximize performance benefits. It also offers insights for policymakers on designing effective subsidies and support mechanisms to promote environmental sustainability and economic growth.Originality/valueThis study contributes to the literature by elucidating the complex relationship between green innovation and firm performance and highlighting the critical roles of government subsidies and digital transformation R&D investments. It offers valuable implications for businesses seeking to balance environmental and economic objectives and policymakers aiming to foster sustainable and profitable practices.

• Publication year

  2024

• Venue

  Kybernetes

• Publication date

  2024-07-03

• Fields of study

  Business, Economics, Environmental Science, Computer Science

• Identifiers
  DOI 10.1108/k-01-2024-0101
• External record

  Open on Semantic Scholar

• Source metadata

  Semantic Scholar

• No claims are published for this paper.

• No concepts are published for this paper.

• How do external resources influence a Firm's green innovation? A study based on absorptive capacity

  2024cited by this paper
• The impacts of China's dual carbon policy on green innovation: Evidence from Chinese heavy-polluting enterprises.

  2023cited by this paper
• Effect of government subsidies on firm innovative performance in China’s shale gas industry

  2023cited by this paper
• Regulating CEO pay and green innovation: moderating role of social capital and government subsidy

  2023cited by this paper
• The impact of digital transformation on enterprise green innovation

  2023cited by this paper
• Will China’s R&D investment improve green innovation performance? An empirical study

  2022cited by this paper
• Government subsidies and corporate environmental investments: a resource-based perspective

  2022cited by this paper
• More government subsidies, more green innovation? The evidence from Chinese new energy vehicle enterprises

  2022cited by this paper
• Do subsidies and R&D investment boost energy transition performance? Evidence from Chinese renewable energy firms

  2022cited by this paper
• Corporate innovation and R&D expenditure disclosures

  2022cited by this paper
• CSR and green process innovation as antecedents of micro, small, and medium enterprise performance: Moderating role of perceived environmental volatility

  2022cited by this paper
• The S-shaped relationship between R&D investment and green innovation after cross-border merge and acquisition: evidence from China

  2022cited by this paper
• Technology improvement strategy for green products under competition: The role of government subsidy

  2021cited by this paper
• Effects of Sustainable Supply Chain Integration on Green Innovation and Firm Performance

  2021cited by this paper
• Government subsidy and corporate green innovation - Does board governance play a role?

  2021cited by this paper
• Government subsidy, asymmetric information and green innovation

  2021cited by this paper
• Environmental regulation, pollution reduction and green innovation: The case of the Chinese Water Ecological Civilization City Pilot policy

  2021cited by this paper
• Product nutrition, innovation, advertising, and firm’s financial gains

  2021cited by this paper
• Can the green credit policy stimulate green innovation in heavily polluting enterprises? Evidence from a quasi-natural experiment in China

  2021cited by this paper
• The more the merrier? Chinese government R&D subsidies, dependence, and firm innovation performance

  2021cited by this paper
• The impact of environmental management on firm economic performance: The mediating effect of green innovation and the moderating effect of environmental leadership

  2021cited by this paper
• Top management team faultlines, green technology innovation and firm financial performance.

  2021cited by this paper
• The impact of synergy effect between government subsidies and slack resources on green technology innovation

  2020cited by this paper
• Impacts of government R&D subsidies on venture capital and renewable energy investment -- an empirical study in China

  2020cited by this paper
• Government subsidies, R&D investment and innovation performance: analysis from pharmaceutical sector in China

  2020cited by this paper
• Do government subsidies promote new-energy firms’ innovation? Evidence from dynamic and threshold models

  2020cited by this paper
• Effects of green supply chain integration and green innovation on environmental and cost performance

  2020cited by this paper
• The impacts of government R&D subsidies on green innovation: Evidence from Chinese energy-intensive firms

  2019cited by this paper
• The impact of government subsidy on supply Chains’ sustainability innovation

  2019cited by this paper
• Do more subsidies promote greater innovation? Evidence from the Chinese electronic manufacturing industry

  2019cited by this paper
• Loaning scale and government subsidy for promoting green innovation

  2019cited by this paper
• Interaction between greening and remanufacturing strategies in a manufacturer-retailer supply chain

  2018cited by this paper
• The drivers of eco-innovation and its impact on performance: Evidence from China

  2018cited by this paper
• Green entrepreneurial orientation for enhancing firm performance: A dynamic capability perspective

  2018cited by this paper
• Mapping states’ Paris climate pledges: Analysing targets and groups at COP 21

  2018cited by this paper
• Impact of environmental regulations on green technological innovative behavior: An empirical study in China

  2018cited by this paper
• The effect of public support on investment and R&D: An empirical evaluation on European manufacturing firms

  2017cited by this paper
• Beyond the question “Does it pay to be green?”: How much green? and when?

  2017cited by this paper
• Cartelization or Cost-sharing? Comparison of cooperation modes in a green supply chain

  2017cited by this paper
• The signal effect of Government R&D Subsidies in China: Does ownership matter?

  2017cited by this paper
• The impact of government subsidies and enterprises’ R&D investment: A panel data study from renewable energy in China

  2016cited by this paper
• R&D for green technologies in a dynamic oligopoly: Schumpeter, arrow and inverted-U's

  2016cited by this paper
• Green R&D for eco-innovation and its impact on carbon emissions and firm performance

  2015cited by this paper
• Patent statistics: A good indicator for innovation in China? Patent subsidy program impacts on patent quality

  2015cited by this paper
• The link of environmental and economic performance: Drivers and limitations of sustainability integration

  2015cited by this paper
• Green corporate image: moderating the connection between environmental product innovation and firm performance

  2014cited by this paper
• Performance effects of top management team demographic faultlines in the process of product diversification.

  2013cited by this paper
• The Influence of Corporate Environmental Ethics on Competitive Advantage: The Mediation Role of Green Innovation

  2011cited by this paper
• Exploitation-Exploration Tensions and Organizational Ambidexterity: Managing Paradoxes of Innovation

  2009cited by this paper
• ANALYSISWhat triggers environmental management and innovation? Empirical evidence for Germany

  2008cited by this paper
• The influence of different characteristics of the EU environmental management and auditing scheme on technical environmental innovations and economic performance

  2006cited by this paper
• The Influence of Green Innovation Performance on Corporate Advantage in Taiwan

  2006cited by this paper
• How to reconcile environmental and economic performance to improve corporate sustainability: corporate environmental strategies in the European paper industry.

  2005cited by this paper
• Redefining innovation -- eco-innovation research and the contribution from ecological economics

  2000cited by this paper
• Imitation Costs and Patents: An Empirical Study

  1981cited by this paper

• Executives' Green Experience, Green Innovation and Corporate Environmental Performance: A Machine Learning-Based News Sentiment Analysis in China

  2026cites this paper
• Influencing factors and realistic path of digital and intelligent transformation in manufacturing enterprises: a dynamic QCA analysis based on the TOE framework

  2025cites this paper
• An evolutionary game-theoretic approach for analysis of startups’ funding mechanisms considering their opportunistic and responsible behavior based on system dynamics

  2025cites this paper