Can financial inclusion affect energy poverty in China? Evidence from a spatial econometric analysis

Abstract

The relationship between financial inclusion (FI) and energy poverty (EP) has received increasing attention across several disciplines in recent years. This study collects panel data from 30 provinces in China from 2011 to 2017 to determine the effects of FI on EP from a spatial analysis perspective. By the spatial Durbin modelling (SDM), it is found that the FI contributes to the alleviation of the EP. Meanwhile, through the heterogeneity analysis from the three dimensions of the FI, we observe that the coverage and the use depth of the FI have significant effects on the EP, with the use depth exhibiting the effect most obviously. Moreover, by analyzing the intermediary effect of the FI on the EP, we find that the FI alleviates the EP through upgrading the industrial structure. In summary, this paper shows that the implementation of the FI impacts the EP and contributes to the EP reduction. These findings may help to inform the development of effective policies with provision of theoretical support for reduction of the EP.