Green finance and innovative cities: Dual-pilot policies and collaborative green innovation

Guanchong Hou and Guifen Shi

International Review of Financial Analysis, 2024, vol. 96, issue PB

Abstract: As the impacts of climate change intensify, urban green innovation has emerged as a critical technological approach for reducing carbon emissions and addressing climate-related risks. In this study, we analyze data from 282 prefecture-level cities in China from 2007 to 2020. Using the time-varying difference-in-difference model, we examine the underlying mechanisms of how green finance and urban innovation policies synergistically drive urban green innovation. Our findings reveal that the dual-pilot policies, namely, Green Finance Reform and Innovation Pilot Zones and Innovative Cities Pilots, have significantly boosted green innovation by leveraging the resource allocation effect. Further research shows that the green innovation is more effective in the central and eastern regions, cities facing resource decline, cities regenerating resource-, and rust-belt areas during the dual-pilot policy implementation process. Moreover, these dual-pilot policies demonstrate a synergy of “1 + 1 > 2.” These results offer fresh insight into further deepening urban policy pilot initiatives.

Keywords: Green finance reform and innovation pilot zones; Innovative city pilots; Green innovation; Time-varying DID model (search for similar items in EconPapers)
JEL-codes: G38 O38 P34 Q55 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:96:y:2024:i:pb:s1057521924006057

DOI: 10.1016/j.irfa.2024.103673

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