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Digital finance, environmental regulation and emission reduction in manufacturing industry: New evidence incorporating dynamic spatial-temporal correlation and competition

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  • Yan, Bin
  • Wang, Feng
  • Chen, Tian
  • Liu, Siyu
  • Bai, Xiaoxuan

Abstract

Applying the Peking University Digital Financial Inclusion Index from 2011 to 2018, we explore the dynamic spatial-temporal correlation effects of digital finance and environmental regulation on manufacturing carbon emissions, emphasizing competition and resolving endogeneity issues. The result reveals that: (1) digital finance reduces local carbon emissions while increasing those of neighbors to a large extent, the overall reduction effect gradually emerges over time; (2) environmental regulation mitigates carbon emissions in both the short and long term with a marginal increasing trend; and (3) financial institution competition promotes these reduction effects. Combining “effective markets” and “responsive governments” yields superior emission reduction.

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  • Yan, Bin & Wang, Feng & Chen, Tian & Liu, Siyu & Bai, Xiaoxuan, 2023. "Digital finance, environmental regulation and emission reduction in manufacturing industry: New evidence incorporating dynamic spatial-temporal correlation and competition," International Review of Economics & Finance, Elsevier, vol. 83(C), pages 750-763.
    • Handle: RePEc:eee:reveco:v:83:y:2023:i:c:p:750-763
    DOI: 10.1016/j.iref.2022.10.025
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    Cited by:

    1. Xu, Jiaqi & She, Shengxiang & Gao, Pengpeng & Sun, Yunpeng, 2023. "Role of green finance in resource efficiency and green economic growth," Resources Policy, Elsevier, vol. 81(C).
    2. Li, Guoxiang & Wu, Haoyue & Jiang, Jieshu & Zong, Qingqing, 2023. "Digital finance and the low-carbon energy transition (LCET) from the perspective of capital-biased technical progress," Energy Economics, Elsevier, vol. 120(C).
    3. Zhang, Pei & Hao, Dongyang, 2023. "Enterprise financial management and fossil fuel energy efficiency for green economic growth," Resources Policy, Elsevier, vol. 84(C).
    4. Lu, Ling & Liu, Peng & Yu, Jian & Shi, Xunpeng, 2023. "Digital inclusive finance and energy transition towards carbon neutrality: Evidence from Chinese firms," Energy Economics, Elsevier, vol. 127(PB).
    5. Sohail Ahmad Javeed & Rashid Latief & Umair Akram, 2023. "The Effects of Board Capital on Green Innovation to Improve Green Total Factor Productivity," Sustainability, MDPI, vol. 15(13), pages 1-18, June.
    6. Jin, Cheng & Luo, Shuangshuang & Sun, Kehan, 2023. "Energy Resources trade and investments for green growth: The case of Countries in the Asia-Pacific Economic Cooperation," Resources Policy, Elsevier, vol. 82(C).

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    More about this item

    Keywords

    Digital finance; Environmental regulation; Financial institution competition; Manufacturing industry; Carbon emissions;
    All these keywords.

    JEL classification:

    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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