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The path of green finance to promote the realization of low-carbon economic transformation under the carbon peaking and carbon neutrality goals: Theoretical model and empirical analysis

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  • Zhang, Yingying
  • Wang, Xinpeng
  • Feng, Nianqiao

Abstract

In 2020, China proposed the Carbon Peaking and Carbon Neutrality Goals, promoting low-carbon economy and the related green financial market environment. The introduction of relevant policies means that China's green financial service system is undergoing transformation. This is not only a manifestation of China's active commitment to environmental protection obligations, but also a major responsibility for China to actively respond to global climate change. It also directly puts forward higher requirements for China to accelerate the implementation of low-carbon economic transformation. Based on the panel data of 30 provinces (cities) from 2006 to 2020, this article realistically uses panel data information as the most fundamental basis, and adopts the Mediating Effect and GMM model to empirically analyze and verify the implementation path of green finance to assist in the low-carbon transformation of the economy. The study found that green finance could assist in the low-carbon transformation of the economy: there are paths of green finance →upgrading industrial structure → GDP carbon emission intensity and green finance →technological innovation→ GDP carbon emission intensity. Heterogeneity analysis showed that, in high-carbon emission areas, the upgrading of industrial structure has played a negative mediating effect in the process of green finance assisting in the low-carbon transformation of the economy. In addition, both the technological innovation paths in high-carbon emission areas and the upgrading industrial structure and technological innovation path in low-carbon emission areas have played a positive mediating effect in the process of green finance assisting in the low-carbon transformation of the economy. The research in this article enriches and develops the theory of finance and economic growth, providing a reference basis for achieving the Carbon Peaking and Carbon Neutrality Goals and coping with the difficulties encountered in the low-carbon transformation of the economy. It is of positive significance in the field of low-carbon development.

Suggested Citation

  • Zhang, Yingying & Wang, Xinpeng & Feng, Nianqiao, 2024. "The path of green finance to promote the realization of low-carbon economic transformation under the carbon peaking and carbon neutrality goals: Theoretical model and empirical analysis," International Review of Financial Analysis, Elsevier, vol. 94(C).
    • Handle: RePEc:eee:finana:v:94:y:2024:i:c:s1057521924001595
    DOI: 10.1016/j.irfa.2024.103227
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