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Climate policy uncertainty and urban green total factor productivity: Evidence from China

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  • Dai, Zhifeng
  • Zhu, Haoyang

Abstract

Climate change has an impact on the environment and the economy, and green total factor productivity (GTFP here after) is a composite proxy contains both the contents of the environmental protection and the economic development. Serving the climate policy uncertainty index of China (CCPU here after) as the key explanatory variable, we employ the panel regression model to explore the influence of CCPU on GTFP of the 277 Chinese prefecture-level cities. The main findings are as follows: First, CCPU has a negative impact on GTFP; Second, the negative impact of CCPU on GTFP varies in different cities according to the population size, location, and environmental regulation level; Third, our empirical results are stable under the robustness tests; Fourth, the further analysis of this paper indicate that the negative impact of CCPU on GTFP mainly comes from the period after 2016. In addition, the negative impact of CCPU is mainly through the channel of the Technical Efficiency. Finally, the sensitivity of the Technical Efficiency to CCPU may vary according to the public environmental concerns and government science expenditures of different cities. The major findings of this paper not only have practical significance for China and its local governments, but also provide useful references for other countries, especially the developing countries.

Suggested Citation

  • Dai, Zhifeng & Zhu, Haoyang, 2024. "Climate policy uncertainty and urban green total factor productivity: Evidence from China," International Review of Financial Analysis, Elsevier, vol. 96(PA).
    • Handle: RePEc:eee:finana:v:96:y:2024:i:pa:s1057521924005258
    DOI: 10.1016/j.irfa.2024.103593
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