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The impact of fiscal technology expenditures on innovation drive and carbon emissions in China

Author

Listed:
  • Jiandong Chen

    (School of Public Administration, Southwestern University of Finance and Economics, Chengdu)

  • Yuqing Li

    (School of Public Administration, Southwestern University of Finance and Economics, Chengdu)

  • Yiyin Xu

    (Business School of Chengdu University)

  • Michael Vardanyan

    (LEM - Lille économie management - UMR 9221 - UA - Université d'Artois - UCL - Université catholique de Lille - ULCO - Université du Littoral Côte d'Opale - Université de Lille - CNRS - Centre National de la Recherche Scientifique)

  • Zhiyang Shen

    (IESEG School of Managementg, LEM - Lille économie management - UMR 9221 - UA - Université d'Artois - UCL - Université catholique de Lille - ULCO - Université du Littoral Côte d'Opale - Université de Lille - CNRS - Centre National de la Recherche Scientifique)

  • Malin Song

    (Collaborative Innovation Center for Ecological Economics and Management, Anhui University of Finance and Economics, Bengbu)

Abstract

China's central government has identified the reduction of carbon emissions as an important strategic goal for achieving economic and social progress. Innovation is the main driver behind these goals, and fiscal technology expenditures are a crucial policy instrument that can influence such innovation. We use a panel of 277 Chinese prefecture-level cities from 2010 to 2019 and a fixed effects econometric model to assess the impact of fiscal technology expenditures on CO2 and study the transmission mechanism underlying this relationship. Our results suggest that public support of research and development initiatives can effectively curb regional carbon emission intensity. Moreover, this effect is particularly strong in areas characterized by relatively low economic growth rates and fiscal pressure. In addition, the analysis of the underlying transmission mechanism suggests that public spending on science and technology can promote emission reduction via investment in digital and green innovation. Hence, it is imperative to increase fiscal technology expenditures in order to help curb carbon emissions at the local level.

Suggested Citation

  • Jiandong Chen & Yuqing Li & Yiyin Xu & Michael Vardanyan & Zhiyang Shen & Malin Song, 2023. "The impact of fiscal technology expenditures on innovation drive and carbon emissions in China," Post-Print hal-04274714, HAL.
    • Handle: RePEc:hal:journl:hal-04274714
    DOI: 10.1016/j.techfore.2023.122631
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    Cited by:

    1. Zhou, Yicheng & Lin, Boqiang, 2025. "The energy-saving effect of green fiscal policy: Empirical evidence from China's comprehensive demonstration cities of energy conservation and emission reduction fiscal policy," Applied Energy, Elsevier, vol. 378(PA).
    2. Zhang, Kun & Zhu, Pei-Hua & Qian, Xiang-Yan, 2024. "National information consumption demonstration city construction and urban green development: A quasi-experiment from Chinese cities," Energy Economics, Elsevier, vol. 130(C).
    3. Lee, Chien-Chiang & Du, Lixia & Wang, Chang-song, 2024. "Carbon blessing or carbon curse? The role of fiscal policy," Economic Analysis and Policy, Elsevier, vol. 83(C), pages 1097-1114.
    4. Xuezhi Ren & Jianya Zhao & Shu Wang & Chunpeng Zhang & Hongzhen Zhang & Nan Wei, 2025. "Exploration of Dual-Carbon Target Pathways Based on Machine Learning Stacking Model and Policy Simulation—A Case Study in Northeast China," Land, MDPI, vol. 14(4), pages 1-31, April.
    5. Chen, Biao & Lin, Huan & Shan, Biaoan & Xiao, Yundong, 2024. "Government investment in science and technology, digital transformation, and innovation in manufacturing enterprises," Finance Research Letters, Elsevier, vol. 69(PB).
    6. Cheng, Zhen & Ding, Chante Jian & Zhao, Kunqian, 2025. "Energy use rights trading and carbon emissions," Energy, Elsevier, vol. 315(C).
    7. Liu, Yajie & Dong, Feng & Li, Guoqing & Pan, Yuling & Qin, Chang & Yang, Shanshan & Li, Jingyun, 2023. "Exploring the factors influencing public support willingness for banning gasoline vehicle sales policy: A grounded theory approach," Energy, Elsevier, vol. 283(C).
    8. Liang, Yufan & He, Xiaolong, 2024. "Does the cross-border e-commerce comprehensive pilot area policy help to improve the level of urban technological innovation?," Economic Analysis and Policy, Elsevier, vol. 84(C), pages 1258-1271.
    9. Li, Haichao & Su, Yuqi & Ding, Chante Jian & Tian, Gary Gang & Wu, Zhan, 2024. "Unveiling the green innovation paradox: Exploring the impact of carbon emission reduction on corporate green technology innovation," Technological Forecasting and Social Change, Elsevier, vol. 207(C).
    10. Zhang, Zhenhua & Deng, Haowen & Yan, Mengxin & Feng, Chao & Sun, Huaping, 2025. "The collaborative effect of green finance policy on pollution and carbon reduction: A quasi-experimental design," International Review of Economics & Finance, Elsevier, vol. 102(C).
    11. Shao, Cuiying & Liu, Zhanyu, 2024. "Advancing green innovation through the establishment of data regulatory bodies: Insights from the Big Data Bureau in China," Economic Analysis and Policy, Elsevier, vol. 84(C), pages 308-325.
    12. Huwei Wen & Yutong Liu, 2023. "Can Fintech Lead to the Collaborative Reduction in Pollution Discharges and Carbon Emissions?," Sustainability, MDPI, vol. 15(15), pages 1-19, July.

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