Environmental governance shock and industrial intelligence upgrading: Insights from machine-labor substitution

Abstract

Industrial intelligent upgrading is an inherent requirement for enterprise development and an urgent need for green economic transformation. From the perspective of machine-labor substitution by Chinese manufacturing enterprises, this study explores the causal relationship between environmental regulation and industrial robot adoption. Utilizing the partially linear functional-coefficient model, this paper further reveals the moderating role of asset size in intelligent upgrading. The findings indicate that with the capital deepening, the effect of environmental regulation on industrial robot investment shifts from insignificant to positively significant. However, the heterogeneous results reveal an unexpected consequence that this impact is more salient for non-polluting enterprises rather than for polluting enterprises which are more targeted by the environmental governance.