IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v18y2025i1p375-d1829589.html

The Digital Economy and Sustainable Development Goals: A Predictive Analysis of the Interconnections Between Digitalization and Sustainability in China

Author

Listed:
  • Meng Ding

    (Department of Economics, Xi’an Jiaotong University, Xi’an 710049, China)

Abstract

This study empirically investigates the impact of the digital economy on sustainable development, with a particular focus on the mediating role of green innovation. Using panel data from 420 regional observations in China, we employ an advanced econometric panel including a two-way fixed effects model, mediation analysis, threshold regression, and instrumental variable (2SLS) techniques to address potential endogeneity. The findings confirm a significant positive direct relationship between the digital economy and sustainable development. Mediation analysis reveals that the digital economy fosters green innovation, which in turn drives sustainable development, accounting for about 17.12% of the total causal effect. A key novelty is our identification of a significant threshold effect: specifically, using a threshold model with 2SLS techniques, we find that sustainability benefits from digitalization are nonlinear and much higher in regions with higher institutional quality. Overall, this study advances the literature by moving beyond a simple direct link to reveal both the underlying causal mechanism and the contingent condition critical for nuanced policy insights.

Suggested Citation

  • Meng Ding, 2025. "The Digital Economy and Sustainable Development Goals: A Predictive Analysis of the Interconnections Between Digitalization and Sustainability in China," Sustainability, MDPI, vol. 18(1), pages 1-24, December.
    • Handle: RePEc:gam:jsusta:v:18:y:2025:i:1:p:375-:d:1829589
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/18/1/375/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/18/1/375/
    Download Restriction: no
    ---><---

    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:18:y:2025:i:1:p:375-:d:1829589. 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.

    We have no bibliographic references for this item. You can help adding them by using 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.