How Environmental Regulation, Digital Development and Technological Innovation Affect China’s Green Economy Performance: Evidence from Dynamic Thresholds and System GMM Panel Data Approaches

Lijiang Jia, Xiaoli Hu, Zhongwei Zhao, Bin He and Weiming Liu
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Lijiang Jia: College of Economics and Management, Harbin Engineering University, Harbin 150001, China
Xiaoli Hu: College of Economics and Management, Harbin Engineering University, Harbin 150001, China
Zhongwei Zhao: College of Economics and Management, Weifang University of Science and Technology, Weifang 262700, China
Bin He: Center for China Public Sector Economy Research, Jilin University, Changchun 130015, China
Weiming Liu: Institute of Jiangxi Economic Development and Reform, Jiangxi University of Finance and Economics, Nanchang 330013, China

Energies, 2022, vol. 15, issue 3, 1-25

Abstract: Based on the background of China’s “carbon neutral” policy and the booming digitalization, how does environmental regulation affect green economy performance? The existing literature has studied the impact of energy consumption on green economic performance. However, the literature has ignored the impact of carbon dioxide emissions on China’s green economy performance. In this regard, this research uses the non-radial distance function (NDDF) to calculate the green economic performance of China’s prefecture-level cities, and uses the dynamic panel threshold model and the systematic GMM method to study the nonlinear impacts and mechanisms of environmental regulation, digital development, technological innovation, and industrial structure upgrade on green economic performance. The panel data set contains 228 Chinese cities from 2003 to 2019. The following findings are established: first, after adding carbon dioxide emissions to China’s green economy performance, the environmental performance was reduced, and the green economy performance was also reduced. Second, the impact of environmental regulations on green economic performance has a double-threshold effect, with threshold values of −0.267 and 3.602, and this double-threshold effect has temporal and regional heterogeneity. Third, environmental regulations of different intensities have a single-threshold effect between digital development, technological innovation, and industrial structure upgrade, with threshold values of 2.955, 3.957, and 2.249, respectively. Fourth, digital development, technological innovation, and industrial structure upgrade promote green economic performance. Fifth, environmental regulation acts on green economic performance through the transmission of digitalization, technological innovation, and industrial structure upgrade. Based on these empirical findings, this research suggests that Chinese local governments should appropriately increase the intensity of environmental regulations, strengthen the digital application and technological innovation, and promote the upgrading of industrial structure to achieve the improvement of urban green economic performance.

Keywords: environmental regulations; green economic performance; digital development; dynamic panel threshold model; system GMM (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)

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