The Impact of Green Financial Agglomeration on Sustainable Development in China: Analysis Based on Regional Heterogeneity and Pathway Mechanisms

Abstract

Based on the panel data of 30 provinces in China from 2012 to 2020, the degree of green financial agglomeration is measured by locational entropy, and the spatial diffusion and polarization effects of green financial agglomeration on sustainable development are analyzed by using the double-fixed spatial Durbin model. By testing the intermediary effect of green technological innovation and the threshold effect of green financial agglomeration, this study confirms the impact of green financial agglomeration on sustainable development. The study demonstrates that green financial agglomeration's impact on economic quality development can be evaluated from a regional heterogeneity perspective. Specifically, in the eastern region, the green financial agglomeration exerts a significant polarization effect on the economic quality development of neighboring regions, resulting in a negative spatial spillover effect. In contrast, the central region has not yet exhibited a spatial spillover effect, while the western region's green financial agglomeration has a noteworthy diffusion effect and a positive spatial spillover effect, significantly promoting the economic quality development of the neighboring regions. Moreover, the study identifies that green financial agglomeration in both the eastern and western regions can enhance economic efficiency and contribute to sustainable development through green technological innovation, as analyzed through the path mechanism. Notably, there is a non-linear relationship between green financial agglomeration and sustainable development.