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How does digital finance affect the efficiency of urban green economies? Evidence from China

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  • Li, Hongmei
  • Xu, Ruizhe

Abstract

Based on the panel data of 238 prefecture-level cities from 2012 to 2021, the fixed effect model, mediation effect model and threshold regression model are used to empirically examine how digital finance affects urban green economic efficiency. The results of the study show that in terms of the overall effect, digital financial development is conducive to improving urban green economic efficiency, and this conclusion still holds after the robustness test. Green technological innovation helps to improve urban green economic efficiency, and it is an important conduction mechanism for digital finance to drive the urban green economic efficiency to realize the leap. The results of the threshold regression show that there is a nonlinear effect of digital finance on urban green economic efficiency. Heterogeneity discussion found that digital finance has a more significant effect on the improvement of green economic efficiency in large cities and medium-mini-sized cities than in mega-cities. This study further expands the relevant content of the impact effect of digital finance, and provides theoretical and practical experience for the continuous improvement of urban economic efficiency.

Suggested Citation

  • Li, Hongmei & Xu, Ruizhe, 2023. "How does digital finance affect the efficiency of urban green economies? Evidence from China," Finance Research Letters, Elsevier, vol. 58(PD).
    • Handle: RePEc:eee:finlet:v:58:y:2023:i:pd:s1544612323009674
    DOI: 10.1016/j.frl.2023.104595
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