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How does green finance derive the resource efficiency and decarbonization of the economy?

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  • Yan, Xiang
  • Yang, Chao
  • Zhang, Renfang

Abstract

This study assesses the impact of green finance on resource efficiency and decarbonization based on the 30 provincial data of China from 2008 to 2018. The quantile and difference-in-differences (DID) models were employed. The empirical results show that green financing could lessen carbon intensity by enhancing resource efficiency. The benchmark findings demonstrate how green financing may directly promote decarbonization. The precondition for this impact includes high levels of transparency, state assistance, human capital development, and urbanization. Green investment is more successful at supporting decarbonization in provinces with higher carbon intensity. Green financing encourages economic growth, resource efficiency, technological advancement, and the transition to renewable energy sources, contributing to carbon emission reductions. The study provides practical policy recommendations for China and other developing and emerging economies to foster the decarbonization and resource efficiency process.

Suggested Citation

  • Yan, Xiang & Yang, Chao & Zhang, Renfang, 2023. "How does green finance derive the resource efficiency and decarbonization of the economy?," Resources Policy, Elsevier, vol. 85(PB).
    • Handle: RePEc:eee:jrpoli:v:85:y:2023:i:pb:s0301420723006451
    DOI: 10.1016/j.resourpol.2023.103934
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