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Governments often turn to subsidies to boost enterprises' innovation activities, which gives subsidized enterprises room for allocating the subsidies among different innovation activities. Taking insights from institutional logic theory, this paper proposes that enterprises exhibit different subsidy-allocation behaviors between nongreen and green innovations and that the positive effect of subsidies on nongreen innovation is greater than that on green innovation due to the double-spillover problem that is pertinent to green innovation. Further, this paper argues that innovation intensity varies from privately-owned enterprises to local and central state-owned enterprises and that the underlying reason for this phenomenon is that enterprises with different ownership structures behave with different institutional logics, face different environmental and innovation pressures, and hold different innovative resource and capability endowments. We test these hypotheses by using longitudinal data (2010–2015) on 175 publicly-traded firms in the pharmaceutical industry in China. Overall, the results support most of the hypotheses. • The effects of governmental subsidies on green and nongreen innovations were examined. • The moderating role of ownership types between innovation subsidies and green/nongreen innovation was examined. • Five-year panel data from 175 publicly traded Chinese pharmaceutical firms were used to test the hypotheses. [ABSTRACT FROM AUTHOR]

This paper provides an in-depth understanding of the mechanisms of green finance on green innovation, focusing on their spatial and non-linear relationships. Using panel data of 30 provinces of China during the period of 2009–2017, a green finance index is constructed, and the spatial Durbin model and panel threshold model are used. The results reveal that: (1) Green finance and green innovation had significant positive autocorrelation, and the development of green finance in provinces of central and western China were still in the lower-level range. (2) The coefficients of the direct effect and indirect effect of green finance on green innovation were significantly positive, which indicated that green finance was conducive to enhancing green innovation in local and adjacent provinces during the research period. (3) Double threshold effects of green finance on green innovation were observed, which demonstrated that the driving effect of green finance was decreased with the raising of intensity of environmental regulation. The implication of these results is that government should make full use of the radiation and trickle-down functions of green finance and green innovation to narrow regional gaps in sustainable development while maintaining a moderate intensity of environmental regulation. • A green finance index of 30 provinces of China during the period of 2009 to 2017 was constructed on the basis of green credit, green securities, green insurance, and green investment. • The heterogeneity of region and time for green finance were analyzed employing the spatial exploratory analysis, which manifested that the spatial evolution of green finance in China presents a gradient decreasing pattern from east to west. • The impact of green finance on green innovation was explored by the spatial Durbin model, which proved that the direct effect and the spatial spillover effect were significantly positive. • Moderate intensity of environmental regulation helps green finance promote green innovation and this value should not exceed a maximum of 0.935. [ABSTRACT FROM AUTHOR]