Green innovation and SO2 emissions: Dynamic threshold effect of human capital

Green innovation is an effective path to decrease environmental pollutions. It is of immense interest to evaluate the roles of green innovation on SO₂ emissions reduction. We also investigate the static and dynamic threshold effect of human capital in the impacting paths of different innovations on SO₂ emissions. The empirical results show that the design patent increases SO₂ emissions while the development of utility patent can decrease SO₂ emissions based on the static analysis and dynamic analysis. Both the “pollution halo” and the “pollution heaven” hypotheses of foreign direct investment (FDI) are validated in China. Moreover, green innovation positively affects SO₂ emission reduction based on the System Generalized Method of Moment (SYS-GMM) estimation. Both static and dynamic panel threshold regression results reveal that the positive effects of different innovations will become larger when human capital exceeds the corresponding threshold values. Hence, it is important to enhance green human capital.