Research on the Mechanism of the Carbon Emission Reduction Effect of Green Finance

Zhaoliang Ma and Zhengdong Fei ()
Additional contact information
Zhaoliang Ma: School of Economics, Anhui University, Hefei 230601, China
Zhengdong Fei: School of Economics, Anhui University, Hefei 230601, China

Sustainability, 2024, vol. 16, issue 7, 1-15

Abstract: Under the background of China’s “double carbon” policy, determining how to use the carbon emission reduction effect of green finance is an important starting point for China to achieve stable economic development and sustainable ecological development. By integrating provincial data from the CEADS, EPS, CSMAR, and CNRDS databases from 2003 to 2021, the two-way fixed-effect models are used to empirically test how green finance can exert a carbon emission reduction effect. This study finds that green finance can significantly reduce carbon emission intensity. A mechanism analysis shows that green finance can promote green technology innovation, induce social investment, and promote the disclosure of the social responsibility information of listed companies to reduce carbon emissions, which is still valid after a series of robustness tests. A heterogeneity analysis finds that the government’s environmental attention and the scale of financial industry development have heterogeneous effects on the carbon emission reduction mechanism of green finance. Both the government’s environmental attention and the scale of financial industry development can induce social investment, but the government’s environmental attention cannot promote the growth of green technology innovation, and the scale of financial industry development cannot promote the disclosure of the social responsibility information of listed companies. This paper broadens the research perspective of green finance to reduce carbon emissions and provides some empirical evidence and a theoretical reference to further promote the green transformation of the “two high and one surplus” industry and the sustainable development of the financial industry.

Keywords: green finance; carbon emission reduction; green technology innovation; social investment; social responsibility information disclosure (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.mdpi.com/2071-1050/16/7/3087/pdf (application/pdf)
https://www.mdpi.com/2071-1050/16/7/3087/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:16:y:2024:i:7:p:3087-:d:1371879

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().