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Financial Technology Development and Green Total Factor Productivity

Author

Listed:
  • Wentao Hu

    (The School of Economics, Xiamen University, Xiamen 361005, China)

  • Xiaoxiao Li

    (School of Mathematics and Statistics, Shangqiu Normal University, Shangqiu 476000, China)

Abstract

As a new product resulting from the deep integration of the financial industry and artificial intelligence (AI) technology, financial technology (fintech) has a significant impact on the progress of green total factor productivity (GTFP). Based on city-level data from 2011 to 2021 in China, this paper used the super-efficiency SBM model with embedded non-expected output and the GML index method to measure the GTFP levels of 283 prefecture-level and above cities and to empirically test the impact of fintech on GTFP and its underlying mechanisms. The empirical results showed that the development of fintech had significantly promoted the improvement of GTFP, and the effect was dynamically stable. Specifically, fintech had a stronger and more significant incentive effect on GTFP in its more mature stage of development. By decomposing fintech into two dimensions, it was found that the depth of fintech development had a stronger impact on GTFP with dynamic superimposed characteristics. Mechanism analysis showed that fintech development can drive the progress of GTFP by improving resource allocation efficiency, optimizing human capital, and incentivizing technological innovation channels. Moderating effect analysis revealed that financial regulation and environmental regulation have a positive moderating effect on the baseline relationship between fintech and GTFP. Further research found that the moderating effects of financial regulation and environmental regulation exhibit significant nonlinear threshold characteristics, and the driving effect of fintech on GTFP can only reach its maximum when both are within the optimal range. This study provides valuable insights for the development and optimization of fintech, the green transformation of the real economy, and high-quality development.

Suggested Citation

  • Wentao Hu & Xiaoxiao Li, 2023. "Financial Technology Development and Green Total Factor Productivity," Sustainability, MDPI, vol. 15(13), pages 1-28, June.
    • Handle: RePEc:gam:jsusta:v:15:y:2023:i:13:p:10309-:d:1183034
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    1. Cevik, Nuket Kırcı & Cevik, Emrah I. & Destek, Mehmet Akif & Bugan, Mehmet Fatih & Manga, Müge, 2024. "Unleashing power of financial technologies on mineral productivity in G-20 countries," Resources Policy, Elsevier, vol. 90(C).
    2. Zhang, Hui & Fahlevi, Mochammad & Aljuaid, Mohammed & Beşer, Nazife Özge & Cabas, Meral & lominchar, Jose, 2024. "A machine learning and quantile analysis of FINTECH and resource efficiency in achieving sustainable development in OECD countries," Resources Policy, Elsevier, vol. 92(C).
    3. Yu, Rong & Li, Jianhong, 2024. "Does fintech influence sustainable development under natural resource constraints: insights from 270 Chinese cities," Resources Policy, Elsevier, vol. 91(C).
    4. Fan, Min & Zhou, Yun & Lu, Zhixi & Gao, Sen, 2024. "Fintech's impact on green productivity in China: Role of fossil fuel energy structure, environmental regulations, government expenditure, and R&D investment," Resources Policy, Elsevier, vol. 91(C).

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