IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v17y2025i21p9474-d1779073.html
   My bibliography  Save this article

Green Finance-Driven and Low-Carbon Energy Transition: A Tripartite Game-Theoretic and Spatial Econometric Analysis Based on Evidence from 30 Chinese Provinces

Author

Listed:
  • Xiuqing Zou

    (School of Economics and Management, Shanghai Electric Power University, Shanghai 201306, China)

  • Shaojun Liu

    (School of Economics and Management, Shanghai Electric Power University, Shanghai 201306, China)

  • Linyin Yang

    (School of Economics and Management, Shanghai Electric Power University, Shanghai 201306, China)

Abstract

Addressing climate change and achieving carbon neutrality are urgent global responsibilities, with China’s “dual carbon” goals presenting a significant challenge and opportunity for its energy sector. Green finance, as a pivotal driver for fostering low-carbon and high-quality development in the energy industry, significantly accelerates its green transition. Employing an integrated micro-macro framework, this study first develops a tripartite evolutionary game model involving government, local energy enterprises, and external energy enterprises to analyze the micro-mechanisms of corporate low-carbon decision-making under green finance policies. Subsequently, utilizing panel data from 30 Chinese provinces (2013–2021), it empirically examines the macro impact of green finance on the industry’s low-carbon, high-quality development using a spatial Durbin model (SDM). Key findings include the following: (1) Game analysis reveals that local enterprises’ low-carbon transition propensity and emission reduction returns increase with R&D investment but are negatively moderated by the tax rate level within green finance policies. (2) Spatial econometric results demonstrate that green finance significantly facilitates local energy industry low-carbon transition via technological progress, confirming a significant negative spatial spillover effect on neighboring regions, with notable regional heterogeneity. (3) The effectiveness of green finance policy exhibits significant regional disparity, being markedly stronger in eastern China compared to central and western regions. The findings provide a theoretical and practical foundation for improving market mechanisms and regional coordination in China’s green finance policies, offering a valuable reference for the design of green finance systems in other major emerging and developing economies.

Suggested Citation

  • Xiuqing Zou & Shaojun Liu & Linyin Yang, 2025. "Green Finance-Driven and Low-Carbon Energy Transition: A Tripartite Game-Theoretic and Spatial Econometric Analysis Based on Evidence from 30 Chinese Provinces," Sustainability, MDPI, vol. 17(21), pages 1-21, October.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:21:p:9474-:d:1779073
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/17/21/9474/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/17/21/9474/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Chen, Kun & Bian, Rui, 2023. "Green financing and renewable resources for China's sustainable growth: Assessing macroeconomic industry impact," Resources Policy, Elsevier, vol. 85(PA).
    2. Zheng, Li & Wang, Juncheng & Zhu, Xiaoneng, 2025. "The impact of green financing on renewable energy growth in China: Insights from provincial data," Renewable Energy, Elsevier, vol. 251(C).
    3. Md Shahiduzzaman & Allan Layton & Khorshed Alam, 2015. "Decomposition of energy-related CO2 emissions in Australia: Challenges and policy implications," Economic Analysis and Policy, Elsevier, vol. 45(c), pages 100-111.
    4. Du, Juntao & Shen, Zhiyang & Song, Malin & Vardanyan, Michael, 2023. "The role of green financing in facilitating renewable energy transition in China: Perspectives from energy governance, environmental regulation, and market reforms," Energy Economics, Elsevier, vol. 120(C).
    5. Ma, Yu & Wang, Yutian & Zhou, Xiangjun, 2024. "The impact of green finance on the development of the non-hydro renewable energy industry: An empirical study based on data from 30 provinces in China," Renewable Energy, Elsevier, vol. 227(C).
    6. David Popp, 2002. "Induced Innovation and Energy Prices," American Economic Review, American Economic Association, vol. 92(1), pages 160-180, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yang, Minhua & Ma, Linkun & Gu, Yan & Wu, Wenfeng, 2025. "The impacts of green bonds on the green innovation: Evidence from the corporate green transformation in China," Emerging Markets Review, Elsevier, vol. 65(C).
    2. Bosetti, Valentina & Carraro, Carlo & Duval, Romain & Tavoni, Massimo, 2011. "What should we expect from innovation? A model-based assessment of the environmental and mitigation cost implications of climate-related R&D," Energy Economics, Elsevier, vol. 33(6), pages 1313-1320.
    3. Hu, Hui & Qi, Shaozhou & Chen, Yuanzhi, 2023. "Using green technology for a better tomorrow: How enterprises and government utilize the carbon trading system and incentive policies," China Economic Review, Elsevier, vol. 78(C).
    4. de la Croix, David & Gosseries, Axel, 2012. "The natalist bias of pollution control," Journal of Environmental Economics and Management, Elsevier, vol. 63(2), pages 271-287.
    5. Cai, Yiyong & Newth, David & Finnigan, John & Gunasekera, Don, 2015. "A hybrid energy-economy model for global integrated assessment of climate change, carbon mitigation and energy transformation," Applied Energy, Elsevier, vol. 148(C), pages 381-395.
    6. Hosan, Shahadat & Rahman, Md Matiar & Karmaker, Shamal Chandra & Saha, Bidyut Baran, 2023. "Energy subsidies and energy technology innovation: Policies for polygeneration systems diffusion," Energy, Elsevier, vol. 267(C).
    7. Korrakot Phomsoda & Nattapong Puttanapong & Mongkut Piantanakulchai, 2021. "Economic Impacts of Thailand’s Biofuel Subsidy Reallocation Using a Dynamic Computable General Equilibrium (CGE) Model," Energies, MDPI, vol. 14(8), pages 1-21, April.
    8. Zhangsheng Liu & Liuqingqing Yang & Liqin Fan, 2021. "Induced Effect of Environmental Regulation on Green Innovation: Evidence from the Increasing-Block Pricing Scheme," IJERPH, MDPI, vol. 18(5), pages 1-15, March.
    9. Durán-Romero, Gemma & López, Ana M. & Beliaeva, Tatiana & Ferasso, Marcos & Garonne, Christophe & Jones, Paul, 2020. "Bridging the gap between circular economy and climate change mitigation policies through eco-innovations and Quintuple Helix Model," Technological Forecasting and Social Change, Elsevier, vol. 160(C).
    10. Satar Bakhsh & Md Shabbir Alam & Wei Zhang, 2024. "Green finance and Sustainable Development Goals: is there a role for geopolitical uncertainty?," Economic Change and Restructuring, Springer, vol. 57(4), pages 1-30, August.
    11. Philippe Aghion & Antoine Dechezleprêtre & David Hémous & Ralf Martin & John Van Reenen, 2016. "Carbon Taxes, Path Dependency, and Directed Technical Change: Evidence from the Auto Industry," Journal of Political Economy, University of Chicago Press, vol. 124(1), pages 1-51.
    12. Perino, Grischa & Requate, Till, 2012. "Does more stringent environmental regulation induce or reduce technology adoption? When the rate of technology adoption is inverted U-shaped," Journal of Environmental Economics and Management, Elsevier, vol. 64(3), pages 456-467.
    13. Mort Webster & Karen Fisher-Vanden & David Popp & Nidhi Santen, 2017. "Should We Give Up after Solyndra? Optimal Technology R&D Portfolios under Uncertainty," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 4(S1), pages 123-151.
    14. Grafström, Jonas & Poudineh, Rahmat, 2023. "No evidence of counteracting policy effects on European solar power invention and diffusion," Energy Policy, Elsevier, vol. 172(C).
    15. Takeshi Niizeki, 2012. "Energy-Saving Technological Change in Japan," Global COE Hi-Stat Discussion Paper Series gd11-218, Institute of Economic Research, Hitotsubashi University.
    16. Ribeiro, Lauro André & Silva, Patrícia Pereira da, 2013. "Surveying techno-economic indicators of microalgae biofuel technologies," Renewable and Sustainable Energy Reviews, Elsevier, vol. 25(C), pages 89-96.
    17. Alicia H. Dang & Roberto Samaniego, 2022. "R&D, Industrial Policy and Growth," JRFM, MDPI, vol. 15(8), pages 1-42, August.
    18. Giovanni Marin & Francesca Lotti, 2017. "Productivity effects of eco-innovations using data on eco-patents," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 26(1), pages 125-148.
    19. Li Chen & Fujia Li & Haonan Zhang & Hao Cheng, 2025. "Can Green Finance Policy Achieve Collaborative Governance of Air Pollution? Evidence from Prefecture-Level Cities in China," Sustainability, MDPI, vol. 17(16), pages 1-20, August.
    20. Kurt Kratena & Michael Wüger, 2012. "Technological Change and Energy Demand in Europe," WIFO Working Papers 427, WIFO.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:17:y:2025:i:21:p:9474-:d:1779073. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.