Selection of Environmental Regulation Tools with Technological Innovation Incentive Based on Comprehensive FGLS Estimation Method

Based on the environmental statistical data of seven western provinces from 2006 to 2013, we empirically investigate the incentive effect of different types of environmental regulations on enterprises’ technological innovation by using the comprehensive feasible generalized least square method, namely “comprehensive FGLS”. Whether the intensity of environmental regulation is controlled or not, voluntary environmental regulations and market-oriented environmental regulations have a positive effect on several referred technological innovation variables. Command-controlled environmental regulations have a negative effect on several technological innovation variables, and all significantly reject the original hypothesis at the level of 1%, with a strong significance, and
${R^{2}}$
is more than 0.98. Combined with the results of empirical analysis, we propose the choice of regulatory tools for the implementation of environmental regulation and incentive for technological innovation.