Author(s)

Xinyue Liao ¹

Affiliation(s)

¹ School of Finance, Fuzhou University of International Studies and Trade, Fuzhou, 350202, China

Corresponding Author

Xinyue Liao

ABSTRACT

Green finance facilitates the attainment of low-carbon economic progression by steering the allocation of capital, aiding in the achievement of the "double carbon" objective. Utilizing panel data from 30 provinces, municipalities, and autonomous regions across China spanning from 2005 to 2021, this study empirically examines the influence of green finance on carbon emission efficacy through a two-way fixed effects model, while investigating the role of green technological innovation in this dynamic by integrating the threshold effects model. The findings indicate that (1) green finance markedly enhances carbon emission efficacy. (2) There exists a singular threshold for green technological innovation. As the level of green finance escalates, the improvement in carbon emission efficacy exhibits a pattern of augmentation, diminishment, and subsequent re-augmentation. (3) An analysis of regional heterogeneity reveals that green finance in the eastern region significantly fosters carbon emission efficacy, whereas an inhibitory effect is observed in the central and western regions. Consequently, it is imperative to refine the green financial framework, advance green technological innovation, and implement tailored financial strategies commensurate with regional requirements to facilitate the realization of the "double carbon" aim.

KEYWORDS

Green finance, Carbon emission efficiency, Green technology innovation, Threshold effect

CITE THIS PAPER

Xinyue Liao, Research on the Impact of Green Finance on Carbon Emission Efficiency—Focusing on the Threshold Role of Green Technology Innovation. Financial Engineering and Risk Management (2024) Vol. 7: 132-142. DOI: http://dx.doi.org/10.23977/ferm.2024.070517.

REFERENCES

[1] Zhang Ting, Li Zehui, Cui Jie. Green finance, environmental regulation and industrial structure optimization[J]. Journal of Shanxi University of Finance and Economics, 2022, 44(06):84-98.
[2] Yu Bo, Fan L. Green finance, technological innovation and high-quality economic development[J]. Nanjing Social Science, 2022, (09):31-43. 
[3] HU Wentao, SUN Junna, CHEN Liang. Green finance, industrial structure ecologization and regional green development [J]. Contemporary Economic Management, 2023, 45(05):88-96.
[4] Xiao Xiaojun, Hu Mingqi. Does Green Finance Reduce CO2 Emission Intensity in Chinese Cities? --an empirical study based on 264 prefecture-level and above cities[J]. Finance Theory and Teaching, 2023, (06):20-28.
[5] Lin Muxi, Xiao Yubo. Measurement of green finance for high-quality economic development and its role mechanism [J]. Contemporary Economic Science, 2023, 45(03):101-113.
[6] Chai Zhengmeng, Deng Yutian, Han Xianfeng. Research on the mechanism and effect of green finance to enhance the resilience of manufacturing industry[J]. Journal of Central South University (Social Science Edition), 2024, 30(02): 114-130.
[7] Wu Yonggang, Zhang Xiaotong, Guo Jing. A study on the impact of green finance on bank risk-taking - the moderating effect based on digital transformation[J]. Financial Regulation Research, 2024(03):100-113.
[8] Huijuan X , Ya Z , Ning Z , et al.CO2 emission reduction potential in China from combined effects of structural adjustment of economy and efficiency improvement[J].Resources, Conservation & Recycling, 2021, 174
[9] Ma Hailiang, Dong Shuli. Impacts of different types of environmental regulations on carbon emission efficiency[J]. Journal of Beijing Institute of Technology (Social Science Edition), 2020, 22(04):1-10.
[10] WANG Xinjing, CHENG Yu. Research on the impact mechanism of urbanization on carbon emission efficiency--an empirical analysis based on global panel data of 118 countries[J]. World Geography Research, 2020, 29(03):503-511.
[11] WANG Xin, WANG Ying. Research on green credit policy to enhance green innovation[J]. Management World, 2021, 37(06): 173-188+11.
[12] Su Dongwei, Lian Lili. Does Green Credit Affect the Investment and Financing Behavior of Heavily Polluting Enterprises? [J]. Financial Research, 2018, (12):123-137.
[13] WU Honghan, XU Jiuping. Analysis of the effect of green finance on regional carbon emission efficiency in China--an empirical study based on dynamic spatial panel model[J]. Social Science Research, 2023, (06):84-92.
[14] XIAO Renqiao, XIAO Yang, QIAN Li. Green finance, green technology innovation and high quality economic development [J]. Technological Economy, 2023, 42(03):1-13.
[15] Yang Haochang, Zhong Shiquan, Li Lianshui. Green technology innovation and carbon emission efficiency: influence mechanism and rebound effect[J]. Science and Technology Progress and Countermeasures, 2023, 40(08):99-107. 
[16] Ding J. Green credit policy, credit resource allocation and corporate strategic response[J]. Economic Review, 2019, (04): 62-75.
[17] Meng Yuxin, Liu Lu, Ran Qiying. Does Green Finance Improve Energy Efficiency? --Based on the perspective of Chinese government R&D subsidies[J]. Ecological Economy, 2023, 39(06):45-53.
[18] Xu Yingqi, Cheng Yu, Wang Jingjing. Spatial and temporal evolution of carbon emission efficiency and the impact of green technology innovation in Chinese resource cities[J]. Geography Research, 2023, 42(03):878-894.
[19] Hansen B E. Threshold effects in non-dynamic panels: estimation, testing, and inference[J]. Journal of econometrics, 1999, 93(2): 345-368.
[20] TIAN Yun, LIN Zijuan. Coupled coordination of agricultural carbon emission efficiency and economic growth in Chinese provinces[J]. China Population-Resources and Environment, 2022, 32(04):13-22.
[21] YIN Ziqiang, SUN Xiqing, XING Maoyuan. Research on the impact of green finance development on green total factor productivity[J]. Statistics and Decision Making, 2021, 37(03):139-144.
[22] QU Xiaoe, LUO Haiyan. Impacts of China's outward foreign direct investment on carbon emissions and the transmission mechanism - Empirical evidence based on the multiple intermediary model[J]. China Population-Resources and Environment, 2021, 31(07):1-14.

Sponsors, Associates, and Links

---

• Information Systems and Economics
  
  
• Accounting, Auditing and Finance
  
  
• Industrial Engineering and Innovation Management
  
  
• Tourism Management and Technology Economy
  
  
• Journal of Computational and Financial Econometrics
  
  
• Accounting and Corporate Management
  
  
• Social Security and Administration Management
  
  
• Population, Resources & Environmental Economics
  
  
• Statistics & Quantitative Economics
  
  
• Agricultural & Forestry Economics and Management
  
  
• Social Medicine and Health Management
  
  
• Land Resource Management
  
  
• Information, Library and Archival Science
  
  
• Journal of Human Resource Development
  
  
• Manufacturing and Service Operations Management
  
  
• Operational Research and Cybernetics