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Analysis of the Threshold Effect of Financial Development on China’s Carbon Intensity

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  • Xiongfeng Pan

    (Faculty of Management and Economics, Dalian University of Technology, Dalian 116023, China)

  • Yaobo Yan

    (Faculty of Management and Economics, Dalian University of Technology, Dalian 116023, China)

  • Xiaoxue Peng

    (Faculty of Management and Economics, Dalian University of Technology, Dalian 116023, China)

  • Qing Liu

    (Faculty of Management and Economics, Dalian University of Technology, Dalian 116023, China)

Abstract

Using panel data on 30 provinces in China from 2005 to 2012, this paper conducts an empirical test on the threshold effect of the relationship between financial development and carbon emission intensity from the perspectives of financial scale and financial efficiency. The results show that at a low level of per capita GDP, the expansion of the financial scale and the enhancement of financial efficiency will increase carbon intensity. When the per capita GDP is greater than the threshold value (RMB 37,410), the expansion of the financial scale will also increase carbon intensity, but the potency of this effect will be weaker. At the same time, the improvement of financial efficiency will help reduce carbon intensity. Most provinces with per capita GDP greater than the threshold value (RMB 37,410) are located in the eastern coastal areas of China, whereas most provinces with per capita GDP less than the threshold value are located in the central and western areas of China. Both raising the level of openness and improving the industrial structure will have significantly positive effects on carbon intensity.

Suggested Citation

  • Xiongfeng Pan & Yaobo Yan & Xiaoxue Peng & Qing Liu, 2016. "Analysis of the Threshold Effect of Financial Development on China’s Carbon Intensity," Sustainability, MDPI, vol. 8(3), pages 1-14, March.
    • Handle: RePEc:gam:jsusta:v:8:y:2016:i:3:p:271-:d:65786
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    Cited by:

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    2. Zhao, Tong, 2023. "The impact of financial inclusion and natural resource endowment on China's carbon emissions in the post-covid-19 period," Resources Policy, Elsevier, vol. 86(PB).
    3. Chunyu Wang & Ling Zhu, 2021. "Life Cycle Assessment of Coal-to-Liquid Process," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(10), pages 14453-14471, October.
    4. Feng Feng & Linlin Peng, 2019. "Is There Any Difference in the Effect of Different R and D Sources on Carbon Intensity in China?," Sustainability, MDPI, vol. 11(6), pages 1-12, March.
    5. Guimei Wang & Muhammad Salman, 2023. "The impacts of heterogeneous environmental regulations on green economic efficiency from the perspective of urbanization: a dynamic threshold analysis," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(9), pages 9485-9516, September.

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