IDEAS home Printed from https://ideas.repec.org/a/pal/palcom/v10y2023i1d10.1057_s41599-023-01595-0.html
   My bibliography  Save this article

Green finance, renewable energy development, and climate change: evidence from regions of China

Author

Listed:
  • Yunpeng Sun

    (Tianjin University of Commerce)

  • Qun Bao

    (Nankai University)

  • Farhad Taghizadeh-Hesary

    (Tokai University)

Abstract

In this study, using data from 2010 to 2021, and by utilizing the stochastic impacts by regression on population, affluence, and technology (STIRPAT) theory, and system generalized method of moments, the effect of green financing and deployment of renewable energy on carbon dioxide emissions in China and its provinces were analyzed. The results show that green financing reduces environmental pollution at the country level. Moreover, with a 1% increase in renewable energy consumption, carbon dioxide emission can be expected to decrease by 0.103%. It also demonstrates that green financing has a statistically significant coefficient only in provinces located in the eastern and western regions. Chinese policymakers should incentive policies for provinces in the eastern region of China in order to have a cleaner environment. The central region should be under supportive and pressure policies to move faster along the path to sustainable development.

Suggested Citation

  • Yunpeng Sun & Qun Bao & Farhad Taghizadeh-Hesary, 2023. "Green finance, renewable energy development, and climate change: evidence from regions of China," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-8, December.
    • Handle: RePEc:pal:palcom:v:10:y:2023:i:1:d:10.1057_s41599-023-01595-0
    DOI: 10.1057/s41599-023-01595-0
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1057/s41599-023-01595-0
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1057/s41599-023-01595-0?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Chen, Yulong & Wang, Zheng & Zhong, Zhangqi, 2019. "CO2 emissions, economic growth, renewable and non-renewable energy production and foreign trade in China," Renewable Energy, Elsevier, vol. 131(C), pages 208-216.
    2. Wang, Liping, 2022. "Research on the dynamic relationship between China's renewable energy consumption and carbon emissions based on ARDL model," Resources Policy, Elsevier, vol. 77(C).
    3. Han, Yingwei & Li, Jie, 2022. "Should investors include green bonds in their portfolios? Evidence for the USA and Europe," International Review of Financial Analysis, Elsevier, vol. 80(C).
    4. Shahid, Muhammad & Ullah, Kafait & Imran, Kashif & Masroor, Neha & Sajid, Muhammad Bilal, 2022. "Economic and environmental analysis of green transport penetration in Pakistan," Energy Policy, Elsevier, vol. 166(C).
    5. Zhou, Mingxiang & Li, Xing, 2022. "Influence of green finance and renewable energy resources over the sustainable development goal of clean energy in China," Resources Policy, Elsevier, vol. 78(C).
    6. Zhang, Dongyang, 2022. "Does the green loan policy boost greener production? – Evidence from Chinese firms," Emerging Markets Review, Elsevier, vol. 51(PB).
    7. Abbasi, Kashif Raza & Shahbaz, Muhammad & Zhang, Jinjun & Irfan, Muhammad & Alvarado, Rafael, 2022. "Analyze the environmental sustainability factors of China: The role of fossil fuel energy and renewable energy," Renewable Energy, Elsevier, vol. 187(C), pages 390-402.
    8. Zhou, Hongji & Xu, Guoyin, 2022. "Research on the impact of green finance on China's regional ecological development based on system GMM model," Resources Policy, Elsevier, vol. 75(C).
    9. Shuyang Chen, 2022. "The inequality impacts of the carbon tax in China," Palgrave Communications, Palgrave Macmillan, vol. 9(1), pages 1-10, December.
    10. van der Ploeg, Frederick & Rezai, Armon & Tovar Reanos, Miguel, 2022. "Gathering support for green tax reform: Evidence from German household surveys," European Economic Review, Elsevier, vol. 141(C).
    11. Qi, Tianyu & Zhang, Xiliang & Karplus, Valerie J., 2014. "The energy and CO2 emissions impact of renewable energy development in China," Energy Policy, Elsevier, vol. 68(C), pages 60-69.
    12. Dong, Kangyin & Wang, Bo & Zhao, Jun & Taghizadeh-Hesary, Farhad, 2022. "Mitigating carbon emissions by accelerating green growth in China," Economic Analysis and Policy, Elsevier, vol. 75(C), pages 226-243.
    13. Norouzi, Nima & Fani, Maryam & Talebi, Saeed, 2022. "Green tax as a path to greener economy: A game theory approach on energy and final goods in Iran," Renewable and Sustainable Energy Reviews, Elsevier, vol. 156(C).
    14. Das, Partha & Kanudia, Amit & Bhakar, Rohit & Mathur, Jyotirmay, 2022. "Intra-regional renewable energy resource variability in long-term energy system planning," Energy, Elsevier, vol. 245(C).
    15. Arellano, Manuel & Bover, Olympia, 1995. "Another look at the instrumental variable estimation of error-components models," Journal of Econometrics, Elsevier, vol. 68(1), pages 29-51, July.
    16. Zhang, Hongsheng & Xiong, Peizhi & Yang, Shangzhao & Yu, Jinna, 2023. "Renewable energy utilization, green finance and agricultural land expansion in China," Resources Policy, Elsevier, vol. 80(C).
    17. Li, Menghan & Hamawandy, Nawzad Majeed & Wahid, Fazle & Rjoub, Husam & Bao, Zongke, 2021. "Renewable energy resources investment and green finance: Evidence from China," Resources Policy, Elsevier, vol. 74(C).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sultanuzzaman, Md Reza & Yahya, Farzan & Lee, Chien-Chiang, 2024. "Exploring the complex interplay of green finance, business cycles, and energy development," Energy, Elsevier, vol. 306(C).
    2. Guoyong Wu & Jianwei Cheng & Fan Yang & Gaozhe Chen, 2024. "Can green finance policy promote ecosystem product value realization? Evidence from a quasi-natural experiment in China," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-18, December.
    3. Andrea C. Rangel Guevara, 2024. "Identifying the losers in the transport transition: evidence from Germany," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-18, December.
    4. Liping Qiu & Lihua Yang & Haiyan Zhou & Feng Hu, 2024. "Deconstruction of green product innovation drivers for regional export-oriented industrial enterprises in China: the product space perspective," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-15, December.
    5. Shang, Wen-Long & Song, Xuewang & Xiang, Qiannian & Chen, Haibo & Elhajj, Mireille & Bi, Huibo & Wang, Kun & Ochieng, Washington, 2025. "The impact of deep reinforcement learning-based traffic signal control on Emission reduction in urban Road networks empowered by cooperative vehicle-infrastructure systems," Applied Energy, Elsevier, vol. 390(C).
    6. Ma, Rui & Xie, Xiao qin & Liu, Bin & Zhou, Fengjiao & Samsurijan, Mohamad Shaharudin bin, 2023. "Transmission to green economic development and the dependence on natural resources in China," Resources Policy, Elsevier, vol. 86(PB).
    7. Xu, Xiaojing & Xu, Runguo, 2023. "Role of green financing and stability in the development of green resources in China," Resources Policy, Elsevier, vol. 85(PA).
    8. Yang, Xiangqing & Long, Laishou, 2024. "Renewable energy transition and its implication on natural resource management for green and sustainable economic recovery," Resources Policy, Elsevier, vol. 89(C).
    9. Uche, Emmanuel & Ngepah, Nicholas & Cifuentes-Faura, Javier, 2023. "Upholding the green agenda of COP27 through publicly funded R&D on energy efficiencies, renewables, nuclear and power storage technologies," Technology in Society, Elsevier, vol. 75(C).
    10. Chao Li & Wenyu Lao, 2025. "Internet of Things’ sustainability effects: quantile and temporal insights," Palgrave Communications, Palgrave Macmillan, vol. 12(1), pages 1-22, December.
    11. Mustafa Tevfik Kartal & Ugur Korkut Pata & Andrew Adewale Alola, 2025. "Impact of green bonds on CO2 emissions and disaggregated level renewable electricity in China and the United States of America," Palgrave Communications, Palgrave Macmillan, vol. 12(1), pages 1-17, December.
    12. Rao, Amar & Kumar, Satish & Karim, Sitara, 2024. "Accelerating renewables: Unveiling the role of green energy markets," Applied Energy, Elsevier, vol. 366(C).
    13. Xuelian Li & Tinghui Lu & Jyh-Horng Lin & Ching-Hui Chang, 2024. "Insurer green financing for a supply chain under cap-and-trade regulation: a capped call contingent claim analysis," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-12, December.
    14. Lee, Chi-Chuan & Fang, Yuzhu, 2025. "Climate finance for energy security: An empirical analysis from a global perspective," Economic Analysis and Policy, Elsevier, vol. 85(C), pages 963-978.
    15. Wang, Yang & Taghizadeh-Hesary, Farhad, 2023. "Green bonds markets and renewable energy development: Policy integration for achieving carbon neutrality," Energy Economics, Elsevier, vol. 123(C).
    16. Silvia Solimene & Daniela Coluccia & Alessandro Bernardo, 2023. "Environmental Impact of Different Business Models: An LCA Study of Fresh Tomato Production in Italy," Sustainability, MDPI, vol. 15(13), pages 1-17, June.
    17. Mahmood, Faisal & Ben Zaied, Younes & Abedin, Mohammad Zoynul, 2024. "Role of green finance instruments in shaping economic cycles," Technological Forecasting and Social Change, Elsevier, vol. 209(C).
    18. Zoungrana, Tibi Didier & Lompo, Aguima Aimé Bernard & Toé, Daouda Lawa tan, 2024. "Effect of climate finance on environmental quality: A global analysis," Research in Economics, Elsevier, vol. 78(4).
    19. Rui, Zhaobiao & Peng, Weicai & Qin, Ximei & Wang, Jun, 2023. "Assessing carbon cap-and-trade policies on hybrid renewable energy investments: Implications for pricing and capacity decisions," Resources Policy, Elsevier, vol. 86(PA).
    20. Tao Ge & Zixuan Hao & Yuan Chen, 2025. "How environmental policy synergy can enhance urban ecological resilience: insights from text mining analysis in China," Palgrave Communications, Palgrave Macmillan, vol. 12(1), pages 1-11, December.
    21. Tibi Didier Zoungrana & Aguima Aimé Bernard Lompo & Daouda Lawa Tan Toé, 2024. "Effect of climate finance on environmental quality: A global analysis," Post-Print hal-04691240, HAL.
    22. Zia, Hafiz Muhammad Yasir & Yang, Wanping & Masood, Abdullah & Ahmed, Afaf & Aldawsari, Salem Hamad, 2025. "Can money help to achieve the Paris agreement goal? the missing piece of the puzzle: How green monetary policy can bridge the emissions gap," Economic Analysis and Policy, Elsevier, vol. 85(C), pages 494-529.

    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. Zoungrana, Tibi Didier & Lompo, Aguima Aimé Bernard & Toé, Daouda Lawa tan, 2024. "Effect of climate finance on environmental quality: A global analysis," Research in Economics, Elsevier, vol. 78(4).
    2. Lee, Chi-Chuan & Zhang, Jian & Hou, Shanshuai, 2023. "The impact of regional renewable energy development on environmental sustainability in China," Resources Policy, Elsevier, vol. 80(C).
    3. Li, Songran & Shao, Qinglong, 2022. "Greening the finance for climate mitigation: An ARDL–ECM approach," Renewable Energy, Elsevier, vol. 199(C), pages 1469-1481.
    4. Tuan-Hock Ng & Ying-San Lim & Ying-Zhee Lim & Kar-Hoong Chan & Chun-Teck Lye, 2024. "Is economic policy uncertainty detrimental to sustainability? Evidence from Asian countries," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(8), pages 20885-20908, August.
    5. Wen, Chen & Xing, Yuhang & Wang, Tao & Liao, Sheng & Gao, Ke, 2025. "How do green supply chain management and renewable energy consumption influence carbon emissions in China and India? A comparative analysis," Energy Economics, Elsevier, vol. 143(C).
    6. Yuhan Jing & Mingzhao Hu & Lingdi Zhao, 2023. "The effect of heterogeneous environmental regulations on the employment skill structure: The system-GMM approach and mediation model," PLOS ONE, Public Library of Science, vol. 18(8), pages 1-33, August.
    7. Dunbar, Kwamie & Treku, Daniel N., 2025. "Do energy transition investment flows aid climate commitments?," Energy Economics, Elsevier, vol. 142(C).
    8. Yinhui Wang & Yugang He & Xiaodan Gao, 2025. "Synergizing Renewable Energy and Circular Economy Strategies: Pioneering Pathways to Environmental Sustainability," Sustainability, MDPI, vol. 17(5), pages 1-22, February.
    9. Ai, Hongshan & Tan, Xiaoqing & Mangla, Sachin Kumar & Emrouznejad, Ali & Liu, Fan & Song, Malin, 2025. "Renewable energy transition and sustainable development: Evidence from China," Energy Economics, Elsevier, vol. 143(C).
    10. Sen, Kanchan Kumar & Chapman, Andrew J. & Saha, Bidyut Baran, 2024. "Women's empowerment: A catalyst for addressing energy poverty and energy inequality in developing countries," Energy, Elsevier, vol. 313(C).
    11. Ekundayo Peter Mesagan, 2022. "Environmental Sustainability in Sub-Saharan Africa: the Case of Production and Consumption Activities," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(4), pages 2840-2867, December.
    12. Lee, Chien-Chiang & Yuan, Zihao & Kang, Yongchao, 2024. "Green finance and land ecological security: A potential mechanism for sustainable development," Economic Analysis and Policy, Elsevier, vol. 84(C), pages 1222-1241.
    13. Lin, Boqiang & Wang, Chonghao, 2023. "Does industrial relocation affect regional carbon intensity? Evidence from China's secondary industry," Energy Policy, Elsevier, vol. 173(C).
    14. Amri, Fethi, 2019. "Renewable and non-renewable categories of energy consumption and trade: Do the development degree and the industrialization degree matter?," Energy, Elsevier, vol. 173(C), pages 374-383.
    15. Xu, Jiaqi & She, Shengxiang & Gao, Pengpeng & Sun, Yunpeng, 2023. "Role of green finance in resource efficiency and green economic growth," Resources Policy, Elsevier, vol. 81(C).
    16. Bakari, Sayef & Tiba, Sofien, 2021. "The impact of Combustible Renewables and Waste on Economic Growth and Environmental Quality in Tunisia," MPRA Paper 108616, University Library of Munich, Germany.
    17. Hakan Güneş & Hamis Miraji Ally Simba & Haydar Karadağ & Mustafa Şit, 2023. "Global Energy Transformation and the Impacts of Systematic Energy Change Policy on Climate Change Mitigation," Sustainability, MDPI, vol. 15(19), pages 1-18, September.
    18. Abbasi, Kashif Raza & Shahbaz, Muhammad & Zhang, Jinjun & Irfan, Muhammad & Alvarado, Rafael, 2022. "Analyze the environmental sustainability factors of China: The role of fossil fuel energy and renewable energy," Renewable Energy, Elsevier, vol. 187(C), pages 390-402.
    19. Nasim, Asma & Chen, Xihui Haviour & al Najjar, Basil & Hoang, Yen Hai, 2025. "The financial sector's response to environmental policy stringency: Comparative analysis of developed and developing economies," Energy Economics, Elsevier, vol. 144(C).
    20. Shobande, Olatunji A. & Ogbeifun, Lawrence & Tiwari, Aviral Kumar, 2024. "Unlocking information technology infrastructure for promoting climate resilience and environmental quality," Technological Forecasting and Social Change, Elsevier, vol. 198(C).

    More about this item

    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:pal:palcom:v:10:y:2023:i:1:d:10.1057_s41599-023-01595-0. 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: https://www.nature.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.