ABSTRACT
Purpose
The study aims to investigate the role of green innovation subsidy policies (GISPs) in reducing the systemic risk (SR) of green innovative enterprises (GIEs).
Methodology
This paper studies the subject behaviours and system evolution rules to construct the artificial GIEs system, and investigates the effects of the GISP intervention and the intention for green R&D on the SR.
Findings
Firstly, the internal and external factors of the constructed model can significantly reduce the number of bankruptcies and the SR of GIEs. In addition, the joint effect is better than a single one and has an obvious ‘synergy effect’.
Originality
This study has practical implications for GIEs, banks, and governments. First, we find the SR of the GIEs. In addition, we adopt bankruptcies to measure SR and consider the liquidity early warning mechanism. Moreover, we focus on the effects of GISP on their SR and emphasize the function of the ‘implicit guarantee mechanism’. More importantly, we compare the forms of GISPs and analyze their possible internal and external mechanisms to reduce SR.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Notes
1 Note that the intention for green R&D is highly related to green R&D investment. The enterprises need to make a decision whether to make the R&D (Shi and Shen Citation2019).
2 Note that we assume that the intention for green R&D and the government subsidy policies are strictly exogenous, which makes it possible to study their joint effects on systemic risk.
3 Note that liquidity assets include fixed assets that can be turned into cash in the short term.
Additional information
Funding
Notes on contributors
Wenke Yang
Wenke Yang and Shuai Lu contributed equally to this work. They are co-first authors.