Can the green finance pilot policy promote the low-carbon transformation of the economy？

Abstract

Based on the panel data of 30 provinces (cities) from 2006 to 2020, this paper selects 2011 and 2017 as the time nodes of the green finance pilot policy, and uses PSM-DID Model and Mediating Effect Model to empirically analyze and verify the promotion effect and mechanism of the green finance pilot policy on the low-carbon transformation of the economy. The study found that both the green finance pilot policies in 2011 and 2017 can promote the low-carbon transformation of the economy, and the policy effect is significant. The Mediation Mechanism Test found that the green finance pilot policy could promote the low-carbon transformation of the economy through two paths: optimization of energy structure and improvement of technological innovation level. The Dynamic Effect Test found that the policy effect of the green finance pilot policy in 2011 to promote the low-carbon transformation of the economy is continuous, while the policy effect of the green finance pilot policy in 2017 to promote the low-carbon transformation of the economy is less continuous. However, the policy effects of the green finance pilot policies in 2011 and 2017 will weaken over time. This paper enriches and develops the relevant research on the green finance pilot policy, providing empirical evidence and research enlightenment for China to further expand the construction scope of the green finance reform and innovation pilot zone, implement green finance policies, and promote the low-carbon transformation of the economy.