@article {653043,
	title = {{\textquotedblleft}Regulation and Innovation: Examining Outcomes in Chinese Pollution Control Policy Areas,{\textquotedblright}},
	journal = {Economic Modelling},
	volume = {89},
	year = {2020},
	pages = {19-31},
	abstract = {In this paper, we examine how two regionally implemented environmental initiatives in China have impacted the innovation ability of Chinese-listed firms. The regional implementation of these policies, with non-policy regions serving as controls, offers researchers the perfect conditions for a natural experiment. Using research and development (R\&amp;D) expenditures and patents as a proxy for innovativeness, we compare the record of innovation of firms inside the policy zones with firms outside the policy zones. We use a Difference-In-Difference-In-Differences (DIDID) method to eliminate endogeneity and take the quality of the patents into account by incorporating sub-items. Results show only one of the regulations had a positive effect and that low quality patents account for most of the innovation. We conclude that reasonably designed environmental regulations, when implemented regionally in competitive industries, do improve Chinese firms{\textquoteright} innovation ability in line with the Porter Hypothesis. The results help us derive some useful policy implications regarding innovation.},
	url = {https://authors.elsevier.com/c/1b5JoyGFsEwbq},
	author = {Liqun Zhuge and Richard B. Freeman and Matthew T. Higgins}
}
