The impact of digital inputs on pollution reduction in Chinese manufacturing enterprises

Abstract

Facilitating pollution reduction in manufacturing enterprises is crucial for implementing the new development concept and achieving sustainable, environmentally friendly growth. This research delves into the influence of digital inputs on pollution emission reduction in Chinese manufacturing enterprises. The study utilizes a combination of the World Input-Output Database, the Chinese Industrial Enterprises Database, and the Chinese Industrial Enterprises Pollution Emission Database covering the period from 2000 to 2012. The findings reveal that digital inputs make a significant contribution to pollution reduction in Chinese manufacturing enterprises. Specifically, digital software inputs and foreign digital factor inputs display more pronounced effects on pollution reduction. The analysis of the mechanism reveals that the pollution reduction effects of digital inputs in manufacturing enterprises can be attributed to several effective mechanisms: the enhancement of energy efficiency, technological innovation, and servitization, as well as the crowding-out effect of pollution control investment. The former mechanisms demonstrate a promoting effect, while the latter exhibits an inhibiting effect. The impact of digital inputs on pollution reduction in manufacturing enterprises displays heterogeneity, with a more significant emission reduction effect observed in industries facing higher environmental regulatory intensity, digitization-unrelated industries, non-state-owned firms, and firms with higher levels of financing constraints. These findings offer empirical evidence and serve as a policy foundation for promoting digital transformation and achieving green economic development in China.