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As an influential economic entity, China's economic growth pattern is changing. The traditional way brought high-speed growth as well as caused environmental damage. The concept of environmental innovation, which combines the advantage of technology innovation and environmental consideration, has become a vital means to achieve sustainable development. Due to the double externality characteristic of environmental innovation, the government plays an important role in its development. Based on provincial panel data from 2008 to 2017, this paper first examines the distinct influences of various economic incentive instruments on environmental innovation. Then, the moderation role of marketization is explored. The results show that governments' direct financial expenditure on environmental protection has a positive impact on environmental innovation, while the effect of the environmental tax is not significant. In addition, the impact is negatively moderated by marketization. [ABSTRACT FROM AUTHOR]