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Exploring the Relationship Between Green Finance and Carbon Productivity: The Mediating Role of Technological Progress Bias

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  • Dianwu Wang

    (School of Economics and Management, Changchun University of Technology, Changchun 130012, China
    Collaborative Innovation Center for Green and Low-Carbon Development, Changchun University of Technology, Changchun 130012, China)

  • Zina Yu

    (School of Economics and Management, Beijing University of Posts and Telecommunications, Beijing 100876, China)

  • Haiying Liu

    (School of Economics and Management, Changchun University of Technology, Changchun 130012, China
    Collaborative Innovation Center for Green and Low-Carbon Development, Changchun University of Technology, Changchun 130012, China)

  • Xianzhe Cai

    (School of Maritime Economics and Management, Dalian Maritime University, Dalian 116026, China)

  • Zhiqun Zhang

    (School of Maritime Economics and Management, Dalian Maritime University, Dalian 116026, China)

Abstract

In the context of global climate change, achieving a green and low-carbon economic transition is essential for sustainable development. This study constructs a model using data from 30 provinces collected between 2006 and 2020 to investigate how green finance influences China’s carbon productivity and the transmission mechanism mediated by factor-biased technological progress. The findings reveal the following: (1) The Moran’s index test for carbon productivity across Chinese provinces demonstrates significant spatial clustering. (2) Green finance exhibits substantial spillover effects on carbon productivity in surrounding regions. (3) Capital-biased and energy-biased technological progress significantly mediate the relationship between green finance and carbon productivity, indicating that green finance enhances carbon productivity by optimizing the allocation of capital, labor, and energy factors. (4) Regional heterogeneity analysis indicates that capital-technology-biased and energy-factor-technology-biased approaches can significantly enhance carbon productivity in Central and Northeastern China. Notably, energy-factor innovation delivers far greater environmental efficiency gains in these regions than in Eastern and Western China.

Suggested Citation

  • Dianwu Wang & Zina Yu & Haiying Liu & Xianzhe Cai & Zhiqun Zhang, 2025. "Exploring the Relationship Between Green Finance and Carbon Productivity: The Mediating Role of Technological Progress Bias," Sustainability, MDPI, vol. 17(19), pages 1-18, September.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:19:p:8725-:d:1760435
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    References listed on IDEAS

    as
    1. Xiaoping Tang & Qiong Wang & Shamsa Noor & Rabia Nazir & Muhammad Junaid Nasrullah & Phool Hussain & Shahbaz Ali Larik, 2024. "Exploring the Impact of Green Finance and Green Innovation on Resource Efficiency: The Mediating Role of Market Regulations and Environmental Regulations," Sustainability, MDPI, vol. 16(18), pages 1-26, September.
    2. Daron Acemoglu, 2002. "Directed Technical Change," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 69(4), pages 781-809.
    3. Weibo Jin & Yiming Wang & Yi Yan & Hongyan Zhou & Longyu Xu & Yi Zhang & Yao Xu & Yuqi Zhang, 2025. "Digital Economy, Green Finance, and Carbon Emissions: Evidence from China," Sustainability, MDPI, vol. 17(12), pages 1-31, June.
    4. Rainer Klump & Peter McAdam & Alpo Willman, 2007. "Factor Substitution and Factor-Augmenting Technical Progress in the United States: A Normalized Supply-Side System Approach," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 183-192, February.
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