Assessing the potential of collaborative innovation strategies to drive green development: Threshold effect of market competition

Environmental management literature suggests that elevating the total factor productivity (TFP) of the renewable energy (RE) industry is pivotal for achieving green development. With intensifying market competition in the RE sector, collaborative innovation (COI) has emerged as a crucial strategic choice for enterprises to address developmental bottlenecks. To assess the potential of COI in driving green development, we leveraged data from 114 Chinese RE enterprises from 2011 to 2022. The research findings indicate: (1) COI significantly enhances the TFP of RE enterprises; this enhancement primarily stems from the positive influence of COI on innovation capabilities. (2) The positive effects of COI on TFP manifest only when market competition surpasses a certain threshold level. (3) COI significantly impacts the TFP of small and medium-sized RE enterprises in the growth stage. •We evaluated Chinese renewable energy (RE) firms' total factor productivity (TFP).•Collaborative innovation (COI) significantly boosts the TFP of RE enterprises.•COI significantly enhances RE firms' innovation capabilities.•The positive impact manifests only when market competition exceeds the threshold.•The impact is more significant in small and medium-sized RE firms in growth.