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The mitigating effect of digital inclusive finance development on urban environmental pollution: Insights from innovation capacity and financing constraints

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  • Liao, Hongji
  • Zhang, Jiarui
  • Gong, Runze
  • Zhang, Wen

Abstract

Drawing upon city-level data spanning from 2011 to 2021, this paper delves into the implications of digital financial inclusion's development on mitigating urban environmental pollution. Our findings underscore the efficacy of digital inclusive finance in significantly reducing urban pollution. This effect is primarily attributed to digital inclusive finance's ability to foster urban innovation capacity, which in turn curbs environmental degradation. Furthermore, by alleviating financing constraints, digital inclusive finance plays a pivotal role in mitigating urban environmental pollution. Notably, the impact of digital inclusive finance on pollution reduction is particularly pronounced in central cities. This research offers compelling evidence for leveraging digital inclusive finance in environmental protection efforts and serves as a valuable reference for shaping future policies in this domain.

Suggested Citation

  • Liao, Hongji & Zhang, Jiarui & Gong, Runze & Zhang, Wen, 2025. "The mitigating effect of digital inclusive finance development on urban environmental pollution: Insights from innovation capacity and financing constraints," International Review of Financial Analysis, Elsevier, vol. 97(C).
    • Handle: RePEc:eee:finana:v:97:y:2025:i:c:s1057521924007476
    DOI: 10.1016/j.irfa.2024.103815
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    Cited by:

    1. Hongcheng Ling & Xiaohong Ling, 2025. "The impact of digital inclusive finance on enterprise digital technology innovation: empirical evidence from the Chinese manufacturing industry," Palgrave Communications, Palgrave Macmillan, vol. 12(1), pages 1-19, December.

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