R&D Tax Deduction Intensity and Patent-Based Low-Carbon Innovation in Photovoltaic Firms: Structural and Conditional Evidence from China

Under the growing pressures of climate change and low-carbon transition, economic policy instruments play an important role in shaping technological innovation in renewable energy industries. This study examines the association between research and development (R&D) tax deduction intensity and patent-based low-carbon innovation among Chinese photovoltaic firms. Using a panel of 71 Chinese A-share listed photovoltaic firms during 2019–2024 and two-way fixed effects models, we find no stable association between R&D tax deduction intensity and firms’ overall innovation output. However, after distinguishing innovation types, R&D tax deduction intensity is positively associated with radical innovation output and negatively associated with incremental innovation output, indicating that R&D tax deduction intensity leads to a structural reallocation of innovation resources rather than a simple expansion of innovation quantity. Further results suggest that financing constraints and the external government subsidy intensity shape the marginal effect of R&D tax deduction intensity. Financing constraints exhibit a relatively stable moderating role, while the effect of the government subsidy intensity becomes more evident when firm financing conditions are jointly considered. These findings highlight the need to evaluate energy-transition policies not only by aggregate innovation output, but also by innovation structure, firm heterogeneity, and complementary policy environments.