Examining the Impact of Digital Economy on Environmental Sustainability in China: Insights into Carbon Emissions and Green Growth

In recent years, the global community has witnessed a growing awareness of the environmental challenges posed by climate change and the urgent need for sustainable development. As a significant player on the world stage, China has set ambitious goals for carbon peaking and neutrality, aiming to combat climate change while fostering high-quality economic development. This research explores the profound influence of the digital economy on reducing carbon emissions and promoting green development in China using panel data gathered from several provinces in China between 2011 and 2022 using a fixed-effects panel data approach. The paper begins by examining the role of digital technology in China’s proactive efforts to achieve carbon peaking and carbon neutrality. It delves into the transformative effects of digital trade, emphasizing how it affects traditional commerce, trade efficiency, and carbon footprints. The research also investigates the interplay between digital trade and carbon emissions, shedding light on its potential to aid environmental preservation. Also, the paper explores the concept of “externality” in industrial clustering and its impact on carbon emissions in the context of digital commerce. It discusses the establishment of carbon emission trading markets as a policy tool for reducing greenhouse gases and its synergy with digital commerce in lowering carbon emissions. The study employs panel data from various Chinese provinces to analyze the correlation between the digital economy and green development. It identifies critical factors contributing to environmental sustainability and examines the relationship between the digital economy’s growth and green growth, considering environmental regulations and geographical variations. Finally, the research offers practical suggestions to enhance the digital economy’s contribution to eco-friendly progress, emphasizing the importance of regional digital development, government regulations, and technological advancements. This comprehensive investigation provides valuable insights into the complex relationship between the digital economy and environmental sustainability in China, offering a theoretical framework and empirical evidence to guide future research and policy initiatives in the pursuit of a greener and more sustainable future.