How artificial intelligence drives corporate green innovation: Intelligent empowerment and smart manufacturing transformation in the digital era

Amid the accelerating convergence of global green transition and digital intelligence, understanding how artificial intelligence (AI) facilitates corporate green innovation has become a pressing issue in both academic discourse and policy practice. This paper leverages China’s AI Innovation and Development Pilot Zone (AI_IDPZ) policy as a quasi−natural experiment and applies a difference−in−differences framework to a panel dataset of A−share listed firms from 2009 to 2023 to systematically assess the policy’s impact on corporate green innovation. Empirical results show that the AI_IDPZ policy significantly increases firms’ green invention outputs. Mechanism analyses reveal that AI fosters green innovation through two key pathways: by enhancing AI deployment at the firm level (intelligent empowerment) and by facilitating the integration of AI with smart manufacturing systems (smart manufacturing transformation). Further heterogeneity analyses indicate that these effects are more prominent in high−tech sectors, manufacturing firms, and non−state−owned enterprises, highlighting the moderating roles of technological absorptive capacity and institutional characteristics. This study enriches the empirical understanding of the AI–green innovation nexus and provides valuable policy implications for promoting an integrated trajectory of intelligent and green development. • AI promotes corporate green innovation via two mechanisms: AI tech deployment & smart manufacturing integration. • AI’s effect on promoting green innovation is much stronger for manufacturing/high−tech firms. • AI’s effect on promoting green innovation is much stronger for non−state−owned.