IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v15y2023i17p13134-d1230218.html
   My bibliography  Save this article

Can Green Finance Drive the Development of the Green Building Industry?—Based on the Evolutionary Game Theory

Author

Listed:
  • Shaoliang Li

    (Hubei Key Laboratory of Construction and Management in Hydropower Engineering, China Three Gorges University, Yichang 443002, China
    College of Hydraulic & Environmental Engineering, China Three Gorges University, Yichang 443002, China)

  • Xiazhong Zheng

    (Hubei Key Laboratory of Construction and Management in Hydropower Engineering, China Three Gorges University, Yichang 443002, China
    College of Hydraulic & Environmental Engineering, China Three Gorges University, Yichang 443002, China)

  • Qin Zeng

    (Hubei Key Laboratory of Construction and Management in Hydropower Engineering, China Three Gorges University, Yichang 443002, China
    College of Hydraulic & Environmental Engineering, China Three Gorges University, Yichang 443002, China)

Abstract

The construction industry has a significant impact on the environment, and green buildings provide an effective means of reducing environmental impact. Green finance can facilitate industrial transformation and upgrading, reduce construction costs, attract investment, and promote green industry development. However, traditional financing models still dominate the financing of green building projects, even if they are not in line with the core principles of green building. To solve this problem, this paper establishes a three-party evolutionary game model, which, based on the assumption of finite rationality, considers three core stakeholders: bank and financial institutions, developers, and consumers. The conditions for evolutionary stable equilibrium are identified through an equilibrium analysis of the strategic behavior of each subject, followed by a replication dynamic analysis. Simulation analysis was used to study the effects of key parameters on cooperative behavior and evolution. The results of the study show that (1) The high initial willingness of bank and financial institutions and consumers has a significant driving effect on the market. (2) When the market willingness is high, the government can steer the market towards the desired goal at relatively low policy costs. (3) With the support of green finance, green buildings can still flourish even if the return is slightly lower than traditional building projects. The results of the study reveal cooperative behavior and its evolutionary patterns, which help stakeholders coordinate their goals and promote the development of the green building industry.

Suggested Citation

  • Shaoliang Li & Xiazhong Zheng & Qin Zeng, 2023. "Can Green Finance Drive the Development of the Green Building Industry?—Based on the Evolutionary Game Theory," Sustainability, MDPI, vol. 15(17), pages 1-17, August.
    • Handle: RePEc:gam:jsusta:v:15:y:2023:i:17:p:13134-:d:1230218
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/15/17/13134/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/15/17/13134/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Chen-Yi Sun & Yin-Guang Chen & Rong-Jing Wang & Shih-Chi Lo & Jyh-Tyng Yau & Ya-Wen Wu, 2019. "Construction Cost of Green Building Certified Residence: A Case Study in Taiwan," Sustainability, MDPI, vol. 11(8), pages 1-10, April.
    2. Zhang, Dayong & Zhang, Zhiwei & Managi, Shunsuke, 2019. "A bibliometric analysis on green finance: Current status, development, and future directions," Finance Research Letters, Elsevier, vol. 29(C), pages 425-430.
    3. Odey Alshboul & Ali Shehadeh & Ghassan Almasabha & Ali Saeed Almuflih, 2022. "Extreme Gradient Boosting-Based Machine Learning Approach for Green Building Cost Prediction," Sustainability, MDPI, vol. 14(11), pages 1-20, May.
    4. Baoquan Cheng & Yuhu Wei & Wei Zhang & Xintao Zhou & Huihua Chen & Lipeng Huang & Jianling Huang & Xiaofang Kang, 2020. "Evolutionary Game Simulation on Government Incentive Strategies of Prefabricated Construction: A System Dynamics Approach," Complexity, Hindawi, vol. 2020, pages 1-11, October.
    5. Wang, Tao & Seo, Seongwon & Liao, Pin-Chao & Fang, Dongping, 2016. "GHG emission reduction performance of state-of-the-art green buildings: Review of two case studies," Renewable and Sustainable Energy Reviews, Elsevier, vol. 56(C), pages 484-493.
    6. Xiaojuan Li & Chen Wang & Mukhtar A. Kassem & Yishu Liu & Kherun Nita Ali, 2022. "Study on Green Building Promotion Incentive Strategy Based on Evolutionary Game between Government and Construction Unit," Sustainability, MDPI, vol. 14(16), pages 1-15, August.
    7. Deng, Yongheng & Wu, Jing, 2014. "Economic returns to residential green building investment: The developers' perspective," Regional Science and Urban Economics, Elsevier, vol. 47(C), pages 35-44.
    8. Yun Chen & Zhigen Hu & Quan Liu & Shu Chen, 2020. "Evolutionary Game Analysis of Tripartite Cooperation Strategy under Mixed Development Environment of Cascade Hydropower Stations," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 34(6), pages 1951-1970, April.
    9. He, Wenhua & Liu, Pei & Lin, Borong & Zhou, Hao & Chen, Xuesheng, 2022. "Green finance support for development of green buildings in China: Effect, mechanism, and policy implications," Energy Policy, Elsevier, vol. 165(C).
    10. Xiangjun Li & Lianhui Li, 2022. "Evolutionary Game Analysis of Green Building Development Dynamic System under Government Regulation: From the Perspective of the Contractor," Mathematical Problems in Engineering, Hindawi, vol. 2022, pages 1-12, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Xianwei Ling & Hong Wang, 2024. "Green Behavior Strategies in the Green Credit Market: Analysis of the Impacts of Enterprises’ Greenwashing and Blockchain Technology," Sustainability, MDPI, vol. 16(11), pages 1-21, June.
    2. Xiaokang Wang & Li Zhu & Yue Tang & Haoyu Deng & Haolong Wang, 2024. "Multiple Paths to Green Building Popularization Under the TOE Framework—A Qualitative Comparative Analysis of Fuzzy Sets Based on 26 Chinese Cities," Sustainability, MDPI, vol. 16(21), pages 1-21, October.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Qianyi Du & Haoran Pan & Shuang Liang & Xiaoxue Liu, 2023. "Can Green Credit Policies Accelerate the Realization of the Dual Carbon Goal in China? Examination Based on an Endogenous Financial CGE Model," IJERPH, MDPI, vol. 20(5), pages 1-26, March.
    2. Zihan Zhang & Junkang Song & Wanjiang Wang, 2023. "Study on the Behavior Strategy of the Subject of Low-Carbon Retrofit of Residential Buildings Based on Tripartite Evolutionary Game," Sustainability, MDPI, vol. 15(9), pages 1-25, May.
    3. Banerjee, Ameet Kumar & Sensoy, Ahmet & Goodell, John W., 2024. "Connectivity and spillover during crises: Highlighting the prominent and growing role of green energy," Energy Economics, Elsevier, vol. 129(C).
    4. Pei Xu & Penghao Ye & Atif Jahanger & Siwei Huang & Fan Zhao, 2023. "Can green credit policy reduce corporate carbon emission intensity: Evidence from China's listed firms," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(5), pages 2623-2638, September.
    5. Sun, Xiaolei & Liu, Chang & Wang, Jun & Li, Jianping, 2020. "Assessing the extreme risk spillovers of international commodities on maritime markets: A GARCH-Copula-CoVaR approach," International Review of Financial Analysis, Elsevier, vol. 68(C).
    6. Yu Cao & Cong Xu & Syahrul Nizam Kamaruzzaman & Nur Mardhiyah Aziz, 2022. "A Systematic Review of Green Building Development in China: Advantages, Challenges and Future Directions," Sustainability, MDPI, vol. 14(19), pages 1-29, September.
    7. Quan-Hoang Vuong & Huyen Thanh T. Nguyen & Thanh-Hang Pham & Manh-Toan Ho & Minh-Hoang Nguyen, 2021. "Assessing the ideological homogeneity in entrepreneurial finance research by highly cited publications," Palgrave Communications, Palgrave Macmillan, vol. 8(1), pages 1-11, December.
    8. Wang, Moran & Li, Xuerong & Wang, Shouyang, 2021. "Discovering research trends and opportunities of green finance and energy policy: A data-driven scientometric analysis," Energy Policy, Elsevier, vol. 154(C).
    9. Satar Bakhsh & Md Shabbir Alam & Wei Zhang, 2024. "Green finance and Sustainable Development Goals: is there a role for geopolitical uncertainty?," Economic Change and Restructuring, Springer, vol. 57(4), pages 1-30, August.
    10. Odey Alshboul & Ali Shehadeh & Rabia Emhamed Al Mamlook & Ghassan Almasabha & Ali Saeed Almuflih & Saleh Y. Alghamdi, 2022. "Prediction Liquidated Damages via Ensemble Machine Learning Model: Towards Sustainable Highway Construction Projects," Sustainability, MDPI, vol. 14(15), pages 1-23, July.
    11. Tsai, I-Chun, 2024. "A wise investment by urban governments: Evidence from intelligent sports facilities," Journal of Asian Economics, Elsevier, vol. 92(C).
    12. Waqas Mehmood & Rasidah Mohd-Rashid & Yasir Abdullah & Ataul Karim Patwary & Attia Aman-Ullah, 2023. "Inclusive mapping of initial public offerings: a bibliometric and literature review study," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(1), pages 655-700, February.
    13. Husain, Shaiara & Sohag, Kazi & Wu, Yanrui, 2022. "The response of green energy and technology investment to climate policy uncertainty: An application of twin transitions strategy," Technology in Society, Elsevier, vol. 71(C).
    14. Mumtaz, Muhammad Zubair & Yoshino, Naoyuki, 2021. "Greenness index: IPO performance and portfolio allocation," Research in International Business and Finance, Elsevier, vol. 57(C).
    15. Shi Yin & Yudan Zhao, 2024. "An agent-based evolutionary system model of the transformation from building material industry (BMI) to green intelligent BMI under supply chain management," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-15, December.
    16. Khan, Ashraf & Goodell, John W. & Hassan, M. Kabir & Paltrinieri, Andrea, 2022. "A bibliometric review of finance bibliometric papers," Finance Research Letters, Elsevier, vol. 47(PA).
    17. Angerer, Martin & Hoffmann, Christian Hugo & Neitzert, Florian & Kraus, Sascha, 2021. "Objective and subjective risks of investing into cryptocurrencies," Finance Research Letters, Elsevier, vol. 40(C).
    18. Zhang, Li & Wu, Jing & Liu, Hongyu, 2018. "Policies to enhance the drivers of green housing development in China," Energy Policy, Elsevier, vol. 121(C), pages 225-235.
    19. Mastroeni, Loretta & Mazzoccoli, Alessandro & Vellucci, Pierluigi, 2024. "Wavelet entropy and complexity–entropy curves approach for energy commodity price predictability amid the transition to alternative energy sources," Chaos, Solitons & Fractals, Elsevier, vol. 184(C).
    20. Kong, Minjin & Lee, Minhyun & Kang, Hyuna & Hong, Taehoon, 2021. "Development of a framework for evaluating the contents and usability of the building life cycle assessment tool," Renewable and Sustainable Energy Reviews, Elsevier, vol. 150(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:15:y:2023:i:17:p:13134-:d:1230218. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.