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Exploring the Mechanism of the Impact of Green Finance and Digital Economy on China’s Green Total Factor Productivity

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  • Jianfeng Guo

    (Henley Business School, University of Reading, Berkshire RG9 3AU, UK
    Economics and Management School, Xi’an University of Posts and Telecommunications, Xi’an 710061, China)

  • Kai Zhang

    (Economics and Management School, Xi’an University of Posts and Telecommunications, Xi’an 710061, China)

  • Kecheng Liu

    (Henley Business School, University of Reading, Berkshire RG9 3AU, UK)

Abstract

In the context of the “double cycle,” promoting the development of a green economy is an important goal for China’s high-quality economic development in the digital age. This paper uses data from 30 provinces (municipalities and autonomous regions) in China during the 2006–2019 period using the Compiled Green Finance Index ( G F ) and Digital Economy Index ( D E ). The interrelationship between green finance, digital economy and green total factor productivity ( G T F P ) is empirically tested by conducting multiple regressions on panel data from 2006–2019 to perform an empirical analysis. Based on this, further analysis was performed with the threshold model. This study found that green finance and digital economy can contribute well to green total factor productivity, but the combination of the two does not have a good effect on green total factor productivity. Further study found that the green finance and digital economy’s contribution to green total factor productivity is mainly derived from technological progress. The regression results based on the panel threshold model show that the more underdeveloped the digital economy is in certain regions, the stronger the role of green finance in promoting efficiency improvement. Therefore, policymakers should formulate differentiated green financial policies according to the level of development of the digital economy and give play to the role of green finance and the digital economy in promoting green total factor productivity.

Suggested Citation

  • Jianfeng Guo & Kai Zhang & Kecheng Liu, 2022. "Exploring the Mechanism of the Impact of Green Finance and Digital Economy on China’s Green Total Factor Productivity," IJERPH, MDPI, vol. 19(23), pages 1-18, December.
    • Handle: RePEc:gam:jijerp:v:19:y:2022:i:23:p:16303-:d:994432
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    1. Hepei Li & Chen Chen & Muhammad Umair, 2023. "Green Finance, Enterprise Energy Efficiency, and Green Total Factor Productivity: Evidence from China," Sustainability, MDPI, vol. 15(14), pages 1-14, July.

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