Public engagement and green innovation: Evidence from China's heavy-polluting enterprises

Public participation in environmental protection has become a key force shaping corporate green strategies. Prior studies often used regional public complaints or reports as proxies for public participation, can introduce aggregation bias. This study addresses this limitation by leveraging the exogenous shock of the Measures for Public Participation in Environmental Protection (MPP) policy. Treating MPP as a quasi-natural experiment, we develop a stochastic evolutionary game model and a difference-in-differences framework to comprehensively examine how public participation influences green innovation (GI) in heavily polluting enterprises. Results show that public participation promotes GI by enhancing regulatory enforcement and increasing environmental information transparency, with its effectiveness positively moderated by regional digitalization levels. These findings offer robust evidence and practical policy insights into the role of public engagement in advancing high-quality green transformation.