Abstract
While previous research has investigated the determinants of urban–rural energy inequality (EI), the significance of green finance has rarely been examined. Using a comprehensive green finance development index and a Chinese provincial panel dataset, this research quantitatively investigates how green finance development impacts EI. Our empirical results reveal a significant U-shaped connection between green finance and urban–rural energy disparity, suggesting that moderate expansion of green finance can efficiently mitigate EI. In addition, this relationship is strongly pronounced in China's western region and is more prominently strengthened in provinces with higher energy activities and digital finance development levels but lower economic and social activity levels. These findings could be attributed to the nonlinear impacts of green finance on energy and industrial structure. Based on the findings, we propose several relevant policy recommendations to support China's plans for advancing the green economy and eradicating EI.
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