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The Impact of Green Finance Pilot Policy on Carbon Intensity in Chinese Cities—Based on the Synthetic Control Method

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  • Libin Feng

    (School of Finance, Southwestern University of Finance and Economics, Chengdu 611130, China)

  • Zhengcheng Sun

    (School of Finance, Southwestern University of Finance and Economics, Chengdu 611130, China
    School of Finance, Yunnan University of Finance and Economics, Kunming 650221, China)

Abstract

As an innovative and efficient approach, green finance unlocks the potential to achieve China’s carbon peak and neutrality goals. This study takes China’s Green Finance Pilot Scheme as a quasi-natural experience and adopts the synthetic control method to evaluate the carbon intensity reduction effects of the Green Finance Pilot Policy (GFPP) based on the city-level panel data in China from 2008 to 2019. We find that the GFPP significantly reduces the carbon intensity of pilot cities in eastern China, such as Guangzhou, Huzhou, and Quzhou. However, implementing GFPP does not achieve the desired reduction effect in Nanchang and Guiyang situated in central and western China. After multiple robustness tests, it can be proved that the preceding conclusions are robust. The mechanism analysis results show that the GFPP can promote carbon intensity reduction through financial agglomeration and green innovation. This study is conducive to assessing the policy effectiveness of China’s GFPP and provides empirical evidence for promoting green finance system construction in China.

Suggested Citation

  • Libin Feng & Zhengcheng Sun, 2023. "The Impact of Green Finance Pilot Policy on Carbon Intensity in Chinese Cities—Based on the Synthetic Control Method," Sustainability, MDPI, vol. 15(15), pages 1-21, July.
    • Handle: RePEc:gam:jsusta:v:15:y:2023:i:15:p:11571-:d:1203248
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