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Digital finance and the energy transition: Evidence from Chinese prefecture-level cities

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  • Wang, Zongrun
  • Cao, Xuxin
  • Ren, Xiaohang
  • Gozgor, Giray

Abstract

The increasing digitalisation of the financial sector can potentially steer cities towards carbon neutrality, especially through digital finance. We conduct a panel data analysis of Chinese prefecture-level cities from 2014 to 2020 using a spatial econometric model to explore the effect of digital finance on energy transition. Further, we explore the spatial spillover effect and its moderating mechanism. Our results confirm a significant positive correlation between digital finance and energy transition efficiency. Moreover, digital finance is found to engender positive spatial spillover effects on energy transition in neighbouring cities. Finally, the analysis of the moderating effect reveals that digital economy policies can amplify the positive correlation between digital finance and energy transition. This finding highlights the importance and positive role of digital finance in realising energy transition.

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  • Wang, Zongrun & Cao, Xuxin & Ren, Xiaohang & Gozgor, Giray, 2024. "Digital finance and the energy transition: Evidence from Chinese prefecture-level cities," Global Finance Journal, Elsevier, vol. 61(C).
    • Handle: RePEc:eee:glofin:v:61:y:2024:i:c:s1044028324000590
    DOI: 10.1016/j.gfj.2024.100987
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    Cited by:

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    2. Mao, Qian & Li, Yilong, 2024. "Blockchain evolution, artificial intelligence and ferrous metal trade," Resources Policy, Elsevier, vol. 98(C).
    3. Liu, Guangqiang & Xu, Weiju & Nguyen, Quang Minh, 2024. "Can the energy transition drive economic development? Empirical analysis of China's provincial panel data," Technological Forecasting and Social Change, Elsevier, vol. 206(C).
    4. Nie, Peng & Zhong, Juncheng & Ren, Zhengliang & Huang, Jinglei, 2024. "Sustainable financing solutions for the growth of resource-driven economies in the digital economy age," Resources Policy, Elsevier, vol. 98(C).
    5. Hamdi Becha & Maha Kalai & Saifeddine Houidi & Kamel Helali, 2025. "Digital financial inclusion, environmental sustainability and regional economic growth in China: insights from a panel threshold model," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 14(1), pages 1-40, December.
    6. Jiang, Zeru & Yuan, Chunlai & Xu, Jingru, 2024. "The impact of digital government on energy sustainability: Empirical evidence from prefecture-level cities in China," Technological Forecasting and Social Change, Elsevier, vol. 209(C).
    7. Hao, Jing & Ren, Xingzi & Bi, Huining & Wu, Ji (George), 2025. "How does digital transformation predict the investment cycle in family enterprises?," Technological Forecasting and Social Change, Elsevier, vol. 210(C).
    8. Shan, Haiyan & Gu, Mengjie, 2024. "How does digital finance alleviate fiscal stress? Evidence from China," Economic Analysis and Policy, Elsevier, vol. 84(C), pages 1202-1221.
    9. Qi Cui & Xiaoyu Ma & Sisi Zhang, 2025. "The impact of green finance on energy saving and carbon reduction: evidence from Chinese cities," Economic Change and Restructuring, Springer, vol. 58(1), pages 1-33, February.
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    More about this item

    Keywords

    Energy transition; Digital finance; Spatial econometric models; Moderating effect;
    All these keywords.

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R28 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Government Policy

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