The Impact of Financial Deepening on Carbon Reductions in China: Evidence from City- and Enterprise-Level Data

This study extends the limited evidence of the China context by establishing a panel fixed-effect model to identify the nexus between financial deepening and carbon emissions. Using newly compiled city-level (287 prefecture-level and above cities) and enterprise-level (resource enterprises listed on...

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Bibliographic Details
Published in:International journal of environmental research and public health 2022-09, Vol.19 (18), p.11355
Main Authors: Tang, Kai, Chen, Qianbo, Tan, Weijie, Wu Feng, Yi Jun
Format: Article
Language:English
Subjects:
Carbon
Carbon dioxide
Carbon Dioxide - analysis
China
Cities
Clean technology
Economic Development
Economic growth
Emissions
Financial institutions
Financial services
Hypotheses
Impact analysis
Industrial development
Innovations
Policy
Technology transfer
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Summary:This study extends the limited evidence of the China context by establishing a panel fixed-effect model to identify the nexus between financial deepening and carbon emissions. Using newly compiled city-level (287 prefecture-level and above cities) and enterprise-level (resource enterprises listed on the Chinese A-shares) datasets from 2007 to 2019, this study quantitatively evaluated finance deepening and analysed the impact of financial deepening on carbon emissions in China, with a particular consideration of green innovation. Our results document that financial deepening contributes to carbon reductions, as shown by the considerably decreased carbon dioxide (CO ) emissions. Both the city-level and enterprise-level estimates argue that financial deepening has a promoting effect on green innovation. Stimulating green innovation is identified as an important mechanism through which financial deepening can contribute to carbon reductions. Policy implications are presented based on the empirical results.
ISSN:1660-4601
1661-7827
1660-4601
DOI:10.3390/ijerph191811355