IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v12y2020i9p3717-d353805.html
   My bibliography  Save this article

Examining the Coordination Between Green Finance and Green Economy Aiming for Sustainable Development: A Case Study of China

Author

Listed:
  • Nana Liu

    (School of Economics and Management, China University of Mining and Technology, Xuzhou 221116, China)

  • Chuanzhe Liu

    (School of Economics and Management, China University of Mining and Technology, Xuzhou 221116, China)

  • Yufei Xia

    (Business School, Jiangsu Normal University, Xuzhou 221116, China)

  • Yi Ren

    (School of Economics and Management, China University of Mining and Technology, Xuzhou 221116, China)

  • Jinzhi Liang

    (School of Economics and Management, China University of Mining and Technology, Xuzhou 221116, China)

Abstract

Green finance (GF) regards social responsibility and environmental protection interests as the core of development and has become a new growth point and a new engine for promoting the development of the green economy (GE). To more accurately grasp the coordination between GF and the GE, the selection of appropriate indicators and feasible methods is worth exploring. Aiming at sustainable development by evaluating the coupling coordination between GF and the GE by means of a comprehensive index system and an integrated approach, this study establishes a coupling coordination degree model based on panel data of 30 Chinese provinces over the period 2007–2016. Furthermore, it evaluates the spatial distribution difference and dynamic evolution trend of the coordination by introducing global/local spatial autocorrelation, a space Markov chain, and a local indicators of spatial association (LISA) Markov chain. According to the research results, the coupling coordination degrees of the provinces exhibit gradual upward trends, and most regions in China are in a barely coordinated state at present. The coordination degree of GF and the GE shows strong spatial dependence overall, and partially presents the characteristics of “high-high (HH)” and “low-low (LL)” clustering patterns. The forecast results show that the future coordination of GF and the GE will remain stable and be affected by the coordinated development of surrounding areas.

Suggested Citation

  • Nana Liu & Chuanzhe Liu & Yufei Xia & Yi Ren & Jinzhi Liang, 2020. "Examining the Coordination Between Green Finance and Green Economy Aiming for Sustainable Development: A Case Study of China," Sustainability, MDPI, vol. 12(9), pages 1-26, May.
    • Handle: RePEc:gam:jsusta:v:12:y:2020:i:9:p:3717-:d:353805
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/12/9/3717/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/12/9/3717/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Rongyan Liu & Deqing Wang & Li Zhang & Lihong Zhang, 2019. "Can green financial development promote regional ecological efficiency? A case study of China," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 95(1), pages 325-341, January.
    2. Cui, Lianbiao & Huang, Yuran, 2018. "Exploring the Schemes for Green Climate Fund Financing: International Lessons," World Development, Elsevier, vol. 101(C), pages 173-187.
    3. Lin Ding & Zhenfeng Shao & Hanchao Zhang & Cong Xu & Dewen Wu, 2016. "A Comprehensive Evaluation of Urban Sustainable Development in China Based on the TOPSIS-Entropy Method," Sustainability, MDPI, vol. 8(8), pages 1-23, August.
    4. Thomas I. Palley, 2013. "Financialization: What It Is and Why It Matters," Palgrave Macmillan Books, in: Financialization, chapter 2, pages 17-40, Palgrave Macmillan.
    5. Volz, Ulrich, 2018. "Fostering Green Finance for Sustainable Development in Asia," ADBI Working Papers 814, Asian Development Bank Institute.
    6. Adam B. Jaffe & Karen Palmer, 1997. "Environmental Regulation And Innovation: A Panel Data Study," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 610-619, November.
    7. Linh Pham, 2016. "Is it risky to go green? A volatility analysis of the green bond market," Journal of Sustainable Finance & Investment, Taylor & Francis Journals, vol. 6(4), pages 263-291, October.
    8. Calderon, Cesar & Liu, Lin, 2003. "The direction of causality between financial development and economic growth," Journal of Development Economics, Elsevier, vol. 72(1), pages 321-334, October.
    9. Ma, Chunbo, 2010. "Who bears the environmental burden in China--An analysis of the distribution of industrial pollution sources?," Ecological Economics, Elsevier, vol. 69(9), pages 1869-1876, July.
    10. Bowen Da & Chuanzhe Liu & Nana Liu & Yufei Xia & Fangming Xie, 2019. "Coal-Electric Power Supply Chain Reduction and Operation Strategy under the Cap-and-Trade Model and Green Financial Background," Sustainability, MDPI, vol. 11(11), pages 1-17, May.
    11. Chami, Ralph & Cosimano, Thomas F. & Fullenkamp, Connel, 2002. "Managing ethical risk: How investing in ethics adds value," Journal of Banking & Finance, Elsevier, vol. 26(9), pages 1697-1718, September.
    12. Tang, Zi, 2015. "An integrated approach to evaluating the coupling coordination between tourism and the environment," Tourism Management, Elsevier, vol. 46(C), pages 11-19.
    13. Law, Siong Hook & Singh, Nirvikar, 2014. "Does too much finance harm economic growth?," Journal of Banking & Finance, Elsevier, vol. 41(C), pages 36-44.
    14. Bill Hopwood & Mary Mellor & Geoff O'Brien, 2005. "Sustainable development: mapping different approaches," Sustainable Development, John Wiley & Sons, Ltd., vol. 13(1), pages 38-52.
    15. Christopoulos, Dimitris K. & Tsionas, Efthymios G., 2004. "Financial development and economic growth: evidence from panel unit root and cointegration tests," Journal of Development Economics, Elsevier, vol. 73(1), pages 55-74, February.
    16. Antimiani, Alessandro & Costantini, Valeria & Markandya, Anil & Paglialunga, Elena & Sforna, Giorgia, 2017. "The Green Climate Fund as an effective compensatory mechanism in global climate negotiations," Environmental Science & Policy, Elsevier, vol. 77(C), pages 49-68.
    17. Lindenberg, Nannette, 2014. "Public instruments to leverage private capital for green investments in developing countries," IDOS Discussion Papers 4/2014, German Institute of Development and Sustainability (IDOS).
    18. Shen, Chung-Hua & Lee, Chien-Chiang, 2006. "Same Financial Development Yet Different Economic Growth: Why?," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 38(7), pages 1907-1944, October.
    19. Friend, Anthony M. & Rapport, David J., 1991. "Evolution of macro-information systems for sustainable development," Ecological Economics, Elsevier, vol. 3(1), pages 59-76, March.
    20. Scholtens, Bert & Dam, Lammertjan, 2007. "Banking on the Equator. Are Banks that Adopted the Equator Principles Different from Non-Adopters?," World Development, Elsevier, vol. 35(8), pages 1307-1328, August.
    21. Min Wang & Xianli Zhao & Qunxi Gong & Zhigeng Ji, 2019. "Measurement of Regional Green Economy Sustainable Development Ability Based on Entropy Weight-Topsis-Coupling Coordination Degree—A Case Study in Shandong Province, China," Sustainability, MDPI, vol. 11(1), pages 1-18, January.
    22. Francisco Climent & Pilar Soriano, 2011. "Green and Good? The Investment Performance of US Environmental Mutual Funds," Journal of Business Ethics, Springer, vol. 103(2), pages 275-287, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jianmu Ye & Efifania Dela, 2023. "The Effect of Green Investment and Green Financing on Sustainable Business Performance of Foreign Chemical Industries Operating in Indonesia: The Mediating Role of Corporate Social Responsibility," Sustainability, MDPI, vol. 15(14), pages 1-28, July.
    2. Chuan Shao & Jia Wei & Chuanzhe Liu, 2021. "Empirical Analysis of the Influence of Green Credit on the Industrial Structure: A Case Study of China," Sustainability, MDPI, vol. 13(11), pages 1-15, May.
    3. Xiuping Li & Ye Yang, 2022. "Does Green Finance Contribute to Corporate Technological Innovation? The Moderating Role of Corporate Social Responsibility," Sustainability, MDPI, vol. 14(9), pages 1-17, May.
    4. Stephen Minas, 2022. "Financing climate justice in the European Union and China: common mechanisms, different perspectives," Asia Europe Journal, Springer, vol. 20(4), pages 377-401, December.
    5. Xiaokai Meng & Ghulam Muhammad Shaikh, 2023. "Evaluating Environmental, Social, and Governance Criteria and Green Finance Investment Strategies Using Fuzzy AHP and Fuzzy WASPAS," Sustainability, MDPI, vol. 15(8), pages 1-19, April.
    6. Sentao Wu & Xin Deng & Yanbin Qi, 2022. "Factors Driving Coordinated Development of Urban Green Economy: An Empirical Evidence from the Chengdu-Chongqing Economic Circle," IJERPH, MDPI, vol. 19(10), pages 1-20, May.
    7. Guang-Wen Zheng & Abu Bakkar Siddik & Mohammad Masukujjaman & Nazneen Fatema & Syed Shah Alam, 2021. "Green Finance Development in Bangladesh: The Role of Private Commercial Banks (PCBs)," Sustainability, MDPI, vol. 13(2), pages 1-17, January.
    8. Gaoweijia Wang & Shanshan Li & Li Yang, 2022. "Research on the Pathway of Green Financial System to Implement the Realization of China’s Carbon Neutrality Target," IJERPH, MDPI, vol. 19(4), pages 1-18, February.
    9. Giedrė Lapinskienė & Irena Danilevičienė, 2023. "Assessment of Green Banking Performance," Sustainability, MDPI, vol. 15(20), pages 1-16, October.
    10. Bhatnagar, S. & Sharma, D., 2022. "Evolution of green finance and its enablers: A bibliometric analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 162(C).
    11. Jing Deng & Jingxuan Lu & Yujie Zheng & Xiaoyun Xing & Cheng Liu & Tao Qin, 2022. "The Impact of the COVID-19 Pandemic on the Connectedness between Green Industries and Financial Markets in China: Evidence from Time-Frequency Domain with Portfolio Implications," Sustainability, MDPI, vol. 14(20), pages 1-24, October.
    12. Xi Chen & Zhigang Chen, 2021. "Can Green Finance Development Reduce Carbon Emissions? Empirical Evidence from 30 Chinese Provinces," Sustainability, MDPI, vol. 13(21), pages 1-18, November.
    13. Decai Tang & Hui Zhong & Jingyi Zhang & Yongguang Dai & Valentina Boamah, 2022. "The Effect of Green Finance on the Ecological and Environmental Quality of the Yangtze River Economic Belt," IJERPH, MDPI, vol. 19(19), pages 1-17, September.
    14. Lei Nie & Purong Chen & Xiuli Liu & Qinqin Shi & Jing Zhang, 2022. "Coupling and Coordinative Development of Green Finance and Industrial-Structure Optimization in China: Spatial-Temporal Difference and Driving Factors," IJERPH, MDPI, vol. 19(17), pages 1-22, September.
    15. Jing Sun & Ningning Zhai & Jichao Miao & Huaping Sun, 2022. "Can Green Finance Effectively Promote the Carbon Emission Reduction in “Local-Neighborhood” Areas?—Empirical Evidence from China," Agriculture, MDPI, vol. 12(10), pages 1-13, September.
    16. Haojia Wang & Dandan Zhao & Qiaowei Zhou & Qinhua Ke & Guanglong Dong, 2023. "The Coupling Relationship between Green Finance and Ecosystem Service Demand in China Based on an Improved Coupling Coordination Degree Model," Land, MDPI, vol. 12(3), pages 1-17, February.
    17. Yang, Qin & Du, Qiang & Razzaq, Asif & Shang, Yunfeng, 2022. "How volatility in green financing, clean energy, and green economic practices derive sustainable performance through ESG indicators? A sectoral study of G7 countries," Resources Policy, Elsevier, vol. 75(C).
    18. Vargas-Hernández José G. & Rakowska Joanna & Vargas-González Omar C., 2022. "Green Economic Development as the Framework for Green Finance and Green Investment," Economic and Regional Studies / Studia Ekonomiczne i Regionalne, Sciendo, vol. 15(3), pages 304-322, September.
    19. Guang-Wen Zheng & Abu Bakkar Siddik & Mohammad Masukujjaman & Nazneen Fatema, 2021. "Factors Affecting the Sustainability Performance of Financial Institutions in Bangladesh: The Role of Green Finance," Sustainability, MDPI, vol. 13(18), pages 1-27, September.
    20. Nada Denona Bogovic & Zvonimira Sverko Grdic, 2020. "Transitioning to a Green Economy—Possible Effects on the Croatian Economy," Sustainability, MDPI, vol. 12(22), pages 1-19, November.
    21. Tao Zhou & Rui Ding & Yiming Du & Yilin Zhang & Shihui Cheng & Ting Zhang, 2022. "Study on the Coupling Coordination and Spatial Correlation Effect of Green Finance and High-Quality Economic Development—Evidence from China," Sustainability, MDPI, vol. 14(6), pages 1-22, March.
    22. Wu, Hong, 2023. "Evaluating the role of renewable energy investment resources and green finance on the economic performance: Evidence from OECD economies," Resources Policy, Elsevier, vol. 80(C).
    23. Xiaofei Dai & Abu Bakkar Siddik & Huawei Tian, 2022. "Corporate Social Responsibility, Green Finance and Environmental Performance: Does Green Innovation Matter?," Sustainability, MDPI, vol. 14(20), pages 1-17, October.
    24. Mohammad Abul Kalam Azad & Md. Aminul Islam & Farid Ahammad Sobhani & Md. Sharif Hassan & Mohammad Masukujjaman, 2022. "Revisiting the Current Status of Green Finance and Sustainable Finance Disbursement: A Policy Insights," Sustainability, MDPI, vol. 14(14), pages 1-14, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Vighneswara Swamy & Munusamy Dharani, 2020. "Thresholds of financial development in the Euro area," The World Economy, Wiley Blackwell, vol. 43(6), pages 1730-1774, June.
    2. Swamy, Vighneswara & Dharani, Munusamy, 2019. "The dynamics of finance-growth nexus in advanced economies," International Review of Economics & Finance, Elsevier, vol. 64(C), pages 122-146.
    3. Vighneswara Swamy & Munusamy Dharani, 2021. "Thresholds in finance–growth nexus: Evidence from G‐7 economies," Australian Economic Papers, Wiley Blackwell, vol. 60(1), pages 1-40, March.
    4. Abdul Rahman & Muhammad Arshad Khan & Lanouar Charfeddine, 2020. "Does Financial Sector Promote Economic Growth in Pakistan? Empirical Evidences From Markov Switching Model," SAGE Open, , vol. 10(4), pages 21582440209, October.
    5. Magda Kandil & Muhammad Shahbaz & Mantu Kumar Mahalik & Duc Khuong Nguyen, 2017. "The drivers of economic growth in China and India: globalization or financial development?," International Journal of Development Issues, Emerald Group Publishing Limited, vol. 16(1), pages 54-84, April.
    6. Vighneswara Swamy & Dharani M, 2020. "The tipping point of financial development? – evidence from OECD countries," International Economics and Economic Policy, Springer, vol. 17(1), pages 125-165, February.
    7. Rongyan Liu & Deqing Wang & Li Zhang & Lihong Zhang, 2019. "Can green financial development promote regional ecological efficiency? A case study of China," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 95(1), pages 325-341, January.
    8. Yaya Su & Zhenghui Li & Cunyi Yang, 2021. "Spatial Interaction Spillover Effects between Digital Financial Technology and Urban Ecological Efficiency in China: An Empirical Study Based on Spatial Simultaneous Equations," IJERPH, MDPI, vol. 18(16), pages 1-27, August.
    9. Samargandi, Nahla & Fidrmuc, Jan & Ghosh, Sugata, 2015. "Is the Relationship Between Financial Development and Economic Growth Monotonic? Evidence from a Sample of Middle-Income Countries," World Development, Elsevier, vol. 68(C), pages 66-81.
    10. Wahidin, Deni & Akimov, Alexandr & Roca, Eduardo, 2021. "The impact of bond market development on economic growth before and after the global financial crisis: Evidence from developed and developing countries," International Review of Financial Analysis, Elsevier, vol. 77(C).
    11. Michiel Bijlsma & Andrei Dubovik, 2014. "Banks, Financial Markets and Growth in Developed Countries: a Survey of the empirical literature," CPB Discussion Paper 266, CPB Netherlands Bureau for Economic Policy Analysis.
    12. Emanuele Ciola, 2020. "Financial sector bargaining power, aggregate growth and systemic risk," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 15(1), pages 89-109, January.
    13. Alessio Ciarlone, 2019. "The relationship between financial development and growth: the case of emerging Europe," Questioni di Economia e Finanza (Occasional Papers) 521, Bank of Italy, Economic Research and International Relations Area.
    14. Charalampos Agiropoulos & Michael L. Polemis & Michael Siopsis & Sotiris Karkalakos, 2022. "Revisiting the finance‐growth nexus: A socioeconomic approach," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(3), pages 2762-2783, July.
    15. Kizito Uyi Ehigiamusoe & Mohamad Shaharudin Samsurijan, 2021. "What matters for finance‐growth nexus? A critical survey of macroeconomic stability, institutions, financial and economic development," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(4), pages 5302-5320, October.
    16. Pradhan, Rudra P. & Arvin, Mak B. & Bahmani, Sahar & Hall, John H. & Norman, Neville R., 2017. "Finance and growth: Evidence from the ARF countries," The Quarterly Review of Economics and Finance, Elsevier, vol. 66(C), pages 136-148.
    17. Michael A. Stemmer, 2017. "Revisiting Finance and Growth in Transition Economies - A Panel Causality Approach," Documents de travail du Centre d'Economie de la Sorbonne 17022, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    18. Gnangnon, Sèna Kimm, 2019. "Financial Development and Tax Revenue in Developing Countries: Investigating the International Trade and Economic Growth Channels," EconStor Preprints 206628, ZBW - Leibniz Information Centre for Economics.
    19. Ibrahim, Muazu & Alagidede, Paul, 2018. "Nonlinearities in financial development–economic growth nexus: Evidence from sub-Saharan Africa," Research in International Business and Finance, Elsevier, vol. 46(C), pages 95-104.
    20. Ebru TOPCU Author- Workplace-Name: Nevsehir Haci Bektas Veli University, Department of Economics, Turkey, 2016. "Reexamining Finance-Growth Nexus: A New Literature Survey," EcoForum, "Stefan cel Mare" University of Suceava, Romania, Faculty of Economics and Public Administration - Economy, Business Administration and Tourism Department., vol. 5(Special I), pages 1-7, august.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:12:y:2020:i:9:p:3717-:d:353805. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.