Impact of fiscal expenditure stress on green transformation risk: evidence from China education authority reform

Fei Peng (), Shibiao Zhou (), Tao Ding () and Huaqing Wu ()
Additional contact information
Fei Peng: Hefei University of Technology
Shibiao Zhou: Hefei University of Technology
Tao Ding: Hefei University of Technology
Huaqing Wu: Hefei University of Technology

Economic Change and Restructuring, 2023, vol. 56, issue 6, No 31, 4565-4601

Abstract: Abstract Ongoing fiscal support is a crucial assurance for achieving green development, while the increasingly prominent fiscal expenditure stress has been subjected to a great challenge in achieving green transformation. Based on China’s education authority reform as a quasi-natural experiment, this study uses green total factor productivity to represent urban green development, which has been widely used in the literature, and reveals how local government fiscal expenditure stress affects green total factor productivity. It is found that local fiscal stress significantly decreases the green total factor productivity of cities. This effect is particularly pronounced for resource-based cities, cities with laxer environmental regulations, and cities under greater pressure to promote and develop their economies. Moreover, it is confirmed that it is not the revenue-raising effect but rather the expenditure reduction effect that is at play. Specifically, local governments have reduced environmental protection expenditures and green subsidies, leading to a decline in the green innovation capacity of cities and corporations. Finally, based on the above findings, policy implications are provided to reduce the risk of green transformation from the perspective of policymakers.

Keywords: Fiscal expenditure stress; Green transformation risk; Green total factor productivity; Green innovation; Education authority reform (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://link.springer.com/10.1007/s10644-023-09567-9 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

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:kap:ecopln:v:56:y:2023:i:6:d:10.1007_s10644-023-09567-9

Ordering information: This journal article can be ordered from
http://www.springer. ... nt/journal/10644/PS2

DOI: 10.1007/s10644-023-09567-9

Access Statistics for this article

Economic Change and Restructuring is currently edited by George Hondroyiannis

More articles in Economic Change and Restructuring from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().