How Can Government Regulation Reinforce the Low-Carbon Effects of Green Finance in China? Heterogeneity of Resource-Based Cities and High-Energy-Consuming Cities

Yuying Hu, Yue Deng and Zhilun Jiao ()
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Yuying Hu: College of Management and Economics, Tiangong University, Tianjin 300387, China
Yue Deng: College of Management and Economics, Tiangong University, Tianjin 300387, China
Zhilun Jiao: College of Economic and Social Development, Nankai University, Tianjin 300071, China

JRFM, 2025, vol. 18, issue 9, 1-19

Abstract: Based on panel data of 273 prefecture-level cities in China from 2006 to 2022, this study empirically examines the impact and mechanism of green finance on urban low-carbon development from the perspective of government regulation. The study yields the following key results: First, green finance significantly promotes urban low-carbon development, and this finding remains valid after addressing endogeneity issues and conducting a series of robustness tests. Second, government regulation strengthens the low-carbon effect of green finance through two pathways: market-oriented reform and urban land planning. Third, the low-carbon effect of green finance is more pronounced in resource-based cities and low-energy-consuming cities, which corresponds to urban disparities in development stages and resource constraints. Given these results, this study proposes two targeted recommendations: institutionalizing the coordination mechanism between land use and carbon markets and implementing context-specific green finance strategies via urban differentiation approaches.

Keywords: green finance; low-carbon effect; government regulation; resource-based cities; high-energy-consuming cities (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2025
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