Green finance, energy consumption, and carbon dioxide emissions: A GMM panel data analysis from China

Abstract

Environmental and energy issues have become a stumbling block to China’s sustainable development, so opening up a green development path has become the focus of much attention. To investigate the impact of green finance on carbon dioxide (CO2) emissions, this paper uses the difference and systematic generalized method of moment (GMM) estimators. The research sample includes panel data for Chinese 30 provinces from 2000 to 2020. The empirical results indicate that the objective of green finance is to reduce CO2 emissions. Meanwhile, the analysis of the mediation effect leads to the conclusion that green finance reduces CO2 emissions by regulating energy consumption. Finally, this study provides policymakers with new ideas for green finance development and energy conservation.