Global warming threatens sustainable human development, and carbon emission rights trading (CERT) has emerged as a key market-based tool for reducing emissions. Yet evidence on how CERT affects corporate green innovation—especially high-quality, substantive innovation—remains mixed and fragmented. Using unbalanced panel data on Chinese A-share listed firms from 2007 to 2016 and applying fixed-effect, DID, and PSM-DID models, this study examines the impact of China’s CERT pilot policy on quota-managed firms’ green innovation. The results show that the policy primarily stimulates substantive green innovation, reflected in green invention patents, with limited influence on strategic, low-novelty patents. Its effects are stronger for firms in central and western pilot regions, in non-high-tech industries, and at more mature stages of development, and differ between firms that anticipated regulation and those brought under quota management unexpectedly. Overall, the findings indicate that a well-designed carbon trading mechanism can reallocate resources to incentivize high-quality green innovation, offering micro-level support for Coasian market-based approaches to environmental externalities and informing the further development of China’s national carbon market.

Against the backdrop of accelerating global digitalization and mounting climate pressures, enabling digital-economy growth while simultaneously controlling carbon emissions has become a critical challenge for China. This study constructs a Digital Economy Development Index (DEI) and a Carbon Emissions Index (CEI) to examine the spatiotemporal evolution and spatial heterogeneity of coordinated development between the digital economy and carbon emissions. We employ global and local Moran’s I, a spatial Markov chain model, and kernel density estimation to investigate spatiotemporal autocorrelation, interregional transition patterns, and the dynamic evolution of the coupling coordination degree over 2011–2022. The results indicate that China’s eastern region performs notably better in achieving coordinated development, maintaining persistently higher coupling coordination levels. In contrast, the central and western regions face substantial challenges; in particular, low-value areas exhibit considerable potential to transition toward higher-value states, suggesting substantial room for improvement. The spatiotemporal analysis further reveals pronounced regional disparities and provides a scientific basis for policymaking aimed at advancing green and low-carbon development strategies tailored to regional characteristics.