Input digitalization and green total factor productivity under the constraint of carbon emissions

Abstract

The growing penetration of digitalization has caused profound changes in economy and energy, and then may affect green total factor productivity (GTFP). This study uses the World Input-Output Database (WIOD) to verify the impact and mechanism of input digitalization on green total factor productivity under the constraint of carbon emissions (low-carbon GTFP). The results indicate that input digitalization significantly improves low-carbon GTFP. Heterogeneity analysis demonstrates that input digitalization has a greater positive effect on low-carbon GTFP in middle-income countries than high-income ones. Input digitalization has a positive effect on low-carbon GTFP in manufacturing and service industry, with no significant effect in agriculture. The relationship for samples after the 2008 financial crisis is consistent with benchmark results while it is not for samples before 2008. Moreover, mechanism analysis shows that the impact of input digitalization on low-carbon GTFP works through two channels: energy efficiency and labor productivity. Further, from the perspective of “dual circulation”, the “localization” tendency of input digitalization under the domestic circulation and the “globalization” tendency of input digitalization under the international circulation can significantly improve low-carbon GTFP. This study provides empirical evidence and decision-making basis for promoting input digitalization as well as the green and high-quality economic development.