Is China’s green growth possible? The roles of green trade and green energy

Abstract

In tandem with global initiatives to ‘go green’, China is undertaking a series of steps to achieve green economic growth. To investigate the dynamic nexus of green growth, green trade, and green energy (3 G) in China, an index is developed in this study to assess the level of provincial green growth by employing five types of indicators – economic growth, environmental pollution loss, carbon emissions loss, natural resource loss, and environmental and natural resource benefits. Then, this paper uses the SYS-GMM method to explore the influences of green trade and green energy on green growth by using data compiled from 30 provinces in China over the period 2007–2016. Furthermore, we check the potential heterogeneity, asymmetry, and internal mediating mechanism of the 3 G nexus. The main findings are highlighted as follows: (1) Green trade and green energy can accelerate China’s green growth; (2) enhancing medium- and high-technology green trade can contribute to improving local green growth; (3) this impact is heterogeneous in regions with different trade levels, and asymmetric at various quantiles for the full panel; (4) the positive investment effect, labour effect, and technical effect are effective mediators of the nexus between green trade and green growth.