Financial Development In China Research Articles

How disaggregated natural resources rents affect financial development: From the perspective of sustainable development

Enhancing financial development has emerged as a paramount goal for nations worldwide, reflecting its pivotal role in fostering economic growth, stability, and prosperity. A developed financial system is inevitable for achieving sustainable development in a country. Therefore, it is essential to take measures that promote financial development. Also, promoting financial development entails knowledge of the determinants of financial development. Therefore, the present study intends to investigate whether during the period from 1989 to 2021, whether coal, oil, and natural gas rents have any impact on financial development in China. To that end, we adopt the novel Fourier ARDL modeling. The results claim that oil rent escalates financial development in the long run, while gas and coal rent impede it. On the contrary, oil rent mitigates financial development in the short run, whereas gas and coal rent promote it. Thus, we direct several policy stances to promote financial development.

Markovian Spatio-Temporal Pattern Variation and Prediction of Green Financial Development in China's Economic Belt Based on ADABOOST Algorithm

This paper constructs a comprehensive index system, measures Chinas provincial G-FINANCING INDEX using the VIKOR algorithm, explores the spatial and temporal distribution pattern of green financial development, hotspot regional migration and discrete trends by establishing a Markov spatial transfer matrix, and predicts the future pattern of green financial development in Chinas three major economic belts based on the machine-learning algorithm ADABOOST, which finds that: (1) the central region maintains a strong development momentum. The development of green finance in the region shows a scale effect, and there is a positive transmission trend of development momentum between cities. The right side of the nuclear density curve in the western region has a clear trailing trend, and the overall degree of improvement is high. The phenomenon of multi-polarisation exists among city clusters. The city clusters in the eastern region as a whole show extremely high development momentum. (2) Geographic background plays an important role in the process of transferring G-FINANCING INDEX in Chinese cities, and the level of regional G-FINANCING INDEX is the result of the joint action of desired outputs and non-desired outputs, which is dominated by the economic activities in the region, and is specifically expressed in the spatial spillover effect of regional G-FINANCING INDEX is the spatial spillover effect of regional economic activities. (3) The evolution of the G-FINANCING INDEX in the study region has obvious spatial spillover effects, and is synergistic with the type of regional G-FINANCING INDEX, showing the phenomenon of club convergence.

Revisiting natural resources and financial development nexus in China under the lens of time‐frequency approach

AbstractExamining the relationship between natural resources and financial development (FD) has been a crucial research area for several years. This study examines the time‐ and frequency‐varying influence of natural resources on FD in China under the “resource curse” concept. In contrast to previous studies, additional economic factors such as economic policy uncertainty (EPU), technological innovation, gross fixed capital formation (GFCF), and government stability (GS) are also considered in the model. Wavelet approaches were used to examine the time‐ and frequency‐based nexus among the variables, covering the period from 1995 to 2021. The outcomes indicate an adverse impact of natural resources on FD in long‐term frequencies during the analyzed period, confirming the “resources curse” in China. The other variables, including technological innovation, gross fixed capital formation, and government stability, are positively linked, while EPU is negatively linked to FD. The policy implications of this study highlight the need for effective resource management, amplifying technological innovation, and efficient governments to spur FD in China.

The impact of natural resource, information and communication technology adoption, and economic expansion on financial development in post COVID era

This study explores the interplay between natural resources, economic growth, and financial development in China, extending the inquiry to the moderating role of Information and Communication Technology (ICT). Utilizing the advanced Fourier Autoregressive Distributed Lag (ARDL) framework on data spanning from 1991 to 2020, our analysis delineates the dual influence of natural resources on financial development. Results indicate that natural resources alone have a deleterious effect on financial development both in the short and long run. However, when combined with ICT, the long-run effects are positive, suggesting that ICT has a transformative potential on the natural resources-financial development nexus. Conversely, in the short run, this interaction proves detrimental. These findings underscore the imperative for a holistic strategy that harmonizes economic growth, ICT advancement, and natural resource utilization to foster sustainable financial development.

Does the resource curse hypothesis hold in China? Evaluating the role of trade liberalisation and gross capital formation

In this study, we thoroughly examine the validity of the resource curse hypothesis in China by investigating the role of gross capital formation, trade globalization, political stability, and economic growth for the period spanning from 1985 to 2020. To accomplish this, we employ the ARDL estimator, which allows us to assess the relationship between these variables and financial development. The findings of our study hold significant implications, particularly considering the growing interest in understanding the potential impact of natural resources on financial development. The resource curse hypothesis suggests that abundant natural resources can hinder rather than foster financial development. Our results lend support to this hypothesis, as we find that natural resources have a detrimental effect on China's financial development. Furthermore, our study reveals that economic growth plays a crucial role in enhancing financial development in China. Additionally, we observe positive impacts of trade globalization and gross fixed capital formation on financial development. However, while political stability exhibits a positive influence on financial development, we find that this relationship is statistically insignificant. Through our time-varying causality analysis, we uncover dynamic patterns of causality between financial development and the examined variables (economic growth and natural resource rent) across different time periods. Notably, we identify feedback causality between financial development and these variables. However, we detect unidirectional causality flowing from political stability, gross capital formation, and trade globalization to financial development.

Research on the impact of the development of green finance in the China region on residents' health.

In the context of implementing the strategy of "double carbon" and "healthy China," this paper firstly measures the level of green finance development and the comprehensive index of health care accessibility in each province by using the entropy weight method based on 30 provincial panel data from 2007 to 2021. A panel fixed effects model was also used to empirically analyze the effect of regional green finance development on the improvement of residents' health. In addition, a panel threshold model was constructed to empirically test the threshold effect of green finance on residents' health under the influence of four external environments: carbon intensity level, healthcare accessibility, residents' living standard and human capital level. The empirical results show that the regional green financial development in China significantly improves the health level of residents. And the impact has significant regional heterogeneity, as shown in the improvement effect is more significant for the provinces in the central and western regions. In addition, the impact of green financial development on the health level of residents in China is non-linearly influenced by external environmental factors. The improvement effect of green finance on residents' health level is more significant in the provinces with higher carbon intensity level, residents' living standard, human capital level and lower accessibility to medical services. In this regard, regional governments should continue to build and optimize a synergistic development ecosystem of green finance and public health, give full play to the advantages of financial leverage, promote green, low-carbon and high-quality economic and social development, and realize the beautiful vision of harmonious coexistence between human beings and nature.

The mediating effect of financial development on CO2 emissions: An empirical study based on provincial panel data in China

Global climate change has become the greatest threat to humanity, and China is developing policies among various industries to peak CO2 emissions as soon as possible and expects the reduction of CO2 emissions through financial development. Based on the panel data of 30 provinces in China from 2000 to 2017, this paper uses fixed effect model and mediating effect model to explore the mechanism and effective pathway of financial development on CO2 emissions per capita among different regions in China. Empirical results consistently indicate that financial development has the significantly positive effect on CO2 emissions per capita, but the impact is inverted U-shaped. It means that only when the financial development in China gradually increased to 4.21 can achieve the goal of reducing CO2 emissions per capita. These results provide new explanatory ideas for the inconsistent direction of the impact of financial development on carbon emissions in existing studies. Then, the technological innovation and industrial structure are intermediaries for financial development to reduce CO2 emissions per capita, while the economic scale is the opposite. And it illustrates not only theoretical but also empirical results on the mediating pathways of financial development driven CO2 emission reduction. Under the theory of “natural resource curse”, in regions with high fossil energy dependence, the mediating effect of the economic scale is greater than that in regions with low fossil energy dependence. But the mediating effects of technological innovation and industrial structure from financial development on CO2 emissions per capita are all negative and more powerful than that in regions with low fossil energy dependence. This provides an important practical basis for the development of differentiated carbon reduction policies through finance in different fossil energy dependent regions.

Renewable energy development and transportation infrastructure matters for green economic growth? Empirical evidence from China

Global warming has hit The modern period worse than ever since the industrial revolution. As a result, more programs that benefit the environment have been launched, notably in renewable energy and green financing. This research delves into how carbon neutrality and sustainable financial development in China are affected by factors including renewable energy, green finance, technological innovation, and economic complexity. The report evaluates the impacts of renewable energy, transportation infrastructure, and green economic growth on China’s green financial development from 2008 to 2020. A two-stage ordinary least squares method is used to account for the endogeneity of this connection. Empirical research supports the significance of green finance in China’s sustainable development, with the results indicating that renewable energy and green economic growth (GDP) are critical determinants for sustainable development. The study’s findings inform policy decisions on how best to promote green finance, renewable energy, and technical innovation in China, all of which are essential to the country’s long-term economic success.

How China is mitigating resource curse through infrastructural development?

With the aim to stimulate economic activities, an effective and stable financial system is indispensable in each country, and meanwhile, natural resources should help to promote economic and financial development in that country. Motivated by this, we examine the effect of natural resources on financial development with the cointegration method, the cointegration regression (namely FMOLS and DOLS), and wavelet coherence approach in China. Mainly, we take the effect of transportation infrastructure into account and utilize economic growth as a control variable. The cointegration test indicates a long-run cointegration equation among natural resources, transportation infrastructure, economic growth, and financial development. Natural resources have a negative impact on financial development, which means the resource curse hypothesis exists, while transportation infrastructure and economic growth play a positive role in enhancing financial development in China. Furthermore, the results of a wavelet coherence analysis show that transportation infrastructure, natural resources, and financial development are all vulnerable at distinct frequencies. The results of FMOLS and DOLS are also supported by wavelet coherence. Our results have significant policy recommendations, indicating that efficient use of natural resources is required to promote sustainable and sound financial development.

Interplay of renewable energy investment efficiency, shareholder control and green financial development in China

The study aims to test the interplay of renewable energy investment efficiency, shareholder control, and green financial development in the context of China. To estimate the connections regression analysis approach and the Richardson model are used. This model is specifically used to assess China's renewable energy investment efficiency. The study's findings suggest that renewable energy companies and green finance development assist in alleviating investment shortages. Moreover, shareholder control has a significant connection with both the study constructs. Intermediary effects between short- and long-term bank loans account for 9.38% of the overall impact. Green finance development has a role in the efficiency of renewable energy investments via short- and long-term bank loans. The study analysis further showed that the annual growth rate was roughly 1%, lower in the Chinese context. Around 4% yearly growth in 2012–2013 indicated that the economy started a strong development period. Green finance development in China was found to have a negative influence on bank loan issuance and hindered the efficiency of renewable energy investment to some degree in 2018, yet the amount of development was marginally decreased with an effective degree of 0.17. Moreover, a risk factor is also significant that green financing growth may increase under-investment in renewable energy enterprises, although reducing credit availability mitigates this risk. According to this study, to complete and build a green financial development system, government should use rules and regulations. Financial institutions and renewable energy firms need to work together to enhance their management and construct financing channels to support the growth of renewable energy enterprises. However, multiple practical implications are recommended on it.

Haze pollution reduction in Chinese cities: Has digital financial development played a role?

Based on the exogenous shock of digital financial development in China in 2013, a difference-in-differences (DID) model is set up in this paper to investigate the causal relationship between digital financial development and haze pollution reduction. The finding of the paper is that a one standard deviation increase in digital finance after 2013 decreases the PM2.5 concentrations by 0.2708 standard deviations. After a number of robustness checks, like placebo tests, instrumental variable (IV) estimations, eliminating disruptive policies, and using alternative specifications, this causal effect is not challenged. In addition, this paper explores three potential mechanisms of digital finance to reduce haze pollution: technological innovation, industrial upgrading, and green development. Moreover, the heterogeneous effects signify that the usage depth of digital finance works best in haze pollution reduction. Digital finance has more positive effects in cities in the north and those with superior Internet infrastructure and higher levels of traditional financial development. However, the quantile regression estimates suggest that for cities with light or very serious haze pollution, the positive impact of digital finance is limited. These findings supplement the research field on the environmental benefits of digital finance, which provides insights for better public policies about digital financial development to achieve haze pollution reduction.

Common Prosperity: A Pathway to Inclusive Financial Development in China’s New Era

Common Prosperity: A Pathway to Inclusive Financial Development in China’s New Era

The Coupling and Coordinated Development of Green Builds and Financial Development in China.

As a labor-intensive industry with a strong industrial driving force and high-technology integration, green buildings offer some comparative advantages. Driven by the concept of green development, green buildings are ushering in a period of opportunity for integrated development among multiple fields. Therefore, this research will select the panel data of the financial industry and the green buildings industry in 2014 and 2018, respectively, in 31 provinces in China (excluding Hong Kong, Macao and Taiwan) and, through the method of factor analysis, will innovatively construct a financial industry development index and a green building Development Index for each province in China. Through the coupling coordination model, it studies the development level of the financial industry and green buildings in various provinces, in order to deeply explore the path and mechanism of coordinated development between the two. The results show that the financial industry and green buildings in the eastern coastal areas have a high level of coupling, and the coupling and coordinated development have a greater degree of correlation. The potential for coupling and coordination in Central China is developing for the better, while volatility in the Northeast and Northwest regions is relatively large. From the time dimension angle, the degree of coupling and coordination between green buildings and the financial industry in China is generally low, and in the transitional stage, from the brink of unbalanced development to a primary stage of coordinated development. Accordingly, this paper proposes that local government should pay attention to the coordination relationship between green buildings and financial industry development and formulate a coordination mechanism between their growth according to local conditions, so as to promote the correct interactive advancement of the two.

A nexus study of carbon emissions and financial development in China using the decoupling analysis.

Investigating the linkage between financial development (FD) and carbon emissions is important for mitigating climate change. Nevertheless, there is a scarcity of studies investigating how carbon emissions decouple from FD. Here, we investigate the relationship between FD and carbon emissions by using the decoupling model based on cross-province data of China during 2000–2019. Then, we use the decomposition method to analyze the nine drivers of decoupling elasticity of FD and CO2 emissions. We found that China experienced weak decoupling and strong negative decoupling in most years. Only the finance develops at a very high level; the FD had spare capacities to promote the reduction in the carbon emissions. For example, several developed provinces (e.g., Tianjin, Zhejiang, Guangdong) realized strong decoupling after 2012. The reduction in energy intensity and the increase of foreign direct investment promoted the decoupling of FD from carbon emissions. During the financial recession period, developing a bank-based financial market helped the emissions reduction. Once financial crisis is overcome, developing a market-based financial market promoted the decoupling of FD from emissions. This is because that with the fast FD, the development of stock market contributed to emission reductions through technological improvement, while the bank loans inhibited the decoupling process through the expansion of capital-labor inputs. Overall, these results help in the assessment of the emissions impacts of FD and in addressing climate change problems.

Natural resources, consumer prices and financial development in China: Measures to control carbon emissions and ecological footprints

China's natural resources are a major factor in its rapid financial development. In this race of development, the environment is compromised and China became the top polluted country in the world. A sustainable environment is required for sustainable development. Unlike others, we examine CO2 emissions and ecological footprint (EFP) to compare the role of natural resource rents (NRR), consumer prices (CP), financial development (FD), and population density (PD) in China. To empirically estimate the proposed linkages, the latest econometric techniques are used i. e, “Stationarity and co-integration tests with structural breaks and the autoregressive distributed lag models”. Findings report U-shaped Environmental Kuznets Curve (EKC) for CO2 emissions and EFP, which means GDP is helping to control CO2 emissions and EFP in China. However, natural resources, consumer prices, and population density are increasing environmental degradation. Moreover, financial development is helpful to decrease carbon emissions and ecological footprints. China needs to re-consider the policy regarding consumer prices, dense inhabitant population and use of natural resources.

Does supply chain matter for environmental firm performance: mediating role of financial development in China

The purpose of this research is to understand the impact of technological innovation on corporate social responsibility and corporate environmental performance, as well as the difference in the measurement of this impact between domestic and foreign companies. Supply chain management is an essential tool to promote environmentally sustainable manufacturing by owning green products, green supply chain management and green manufacturing processes, believes that companies should participate in inappropriate policies, assessments, practices and activities while achieving all components of economy, environment, charity and ethics. The hierarchical regression model is used to analyse 175 small and medium enterprises samples. The survey results show that technological innovation will affect environmental performance and will also have a positive impact on company performance. Efficient companies can bring greater financial success, which not only supports economic community projects but also supports social welfare. Innovating through the participation of management and employees in environmental protection practices can not only improve the company’s performance but also enhance the company’s image among stakeholders. The findings of this article strengthen existing theories and help establish sustainable practices in Chinese and other developing and developed countries.

Impact of COVID-19 on recent trends in digital payments : A case study on China

One of the global megatrends is the expansion of digital financial solutions, and seemingly this expansion will continue as there is still room for adopting technology-driven solutions in finance. Regarding global data, the majority of people already have access to financial services: nearly 69 percent of responding adults confirmed that they have accounts at financial institutions. With the far-reaching development of technology, digital payments came into the public as one of the digital financial solutions. In particular, this development sped up during the COVID-19 epidemic, during which people were using remote services in order to keep their physical distance and avoid contamination. Though legal and cybersecurity concerns emerge, the physical infrastructure is developed enough to provide accessible financial services for many more people than today. Countries in various regions adopt modern financial solutions differently, but digital financial solutions are inevitable. In this research paper, the impact of the COVID-19 epidemic on the recent trends of digital payment is examined and presented. The paper aims to detect how new payment solutions change the landscape. The methodology of this study is a case study and data analysis. The successful example of China as a digital payment adopting country is analysed as a case study since the country experienced a large expansion in digital finance. Digital financial solutions and digital payment data are collected from the World Bank. The paper contributes to the literature on digital financial development in China during and after COVID-19.

Does nuclear or renewable energy consumption help to control environmental pollution? New evidence from China

• Assessed long term impacts of renewable energy, financial development and nuclear energy on CO 2 emissions. • Evaluate the energy consumptions and GDP effects on carbon footprints. • Renewable energy and nuclear energy lead to significant contributed to clean energy production. • Results can help policymakers in the enactment of future policies with carbon emission abatement. China has emerged as a significant contributor to the extension of the global economy, which is progressively distressed about carbon emissions discharges resulting from massive energy use in recent years. As energy consumption, clean energy sources are getting immense attention among researchers and policymakers. However, the use of clean energy in curbing carbon emissions has remained inconclusive and demands further analysis. Therefore, this study analyses the long-run effect of renewable energy, nuclear energy consumption on CO 2 emission, and the causal relationship in a multivariate framework such as GDP, fossil fuel energy consumption, and financial development in China from 1995 to 2017. The empirical findings reveal that renewable energy has a negative effect on CO 2 emission as it improves the environment in the long run, but nuclear energy consumption has an adverse impact but is insignificant. The Granger causality indicates a bidirectional causality from renewable energy consumption to CO 2 emission that supports the feedback hypothesis in China. The present study provides new insights and policy guidelines for sustainable energy based on the results.

Asymmetric and time-varying linkages between carbon emissions, globalization, natural resources and financial development in China.

In the real world, economic covariates follow asymmetric and time-varying patterns. Therefore, it is imperative to integrate these effects while estimating environmental and economic relationships. Although prevailing literature reveals various emissions-deriving and eliminating factors, however, there is a dearth of empirical evidence that estimates the asymmetric and time-varying effect of globalization, natural resources, and financial development from a multidimensional perspective in China. In doing so, we employ the nonlinear autoregressive distributed lag (NARDL) and cross-wavelet modeling framework to explore the long- and short-run nonlinear and time-variant association between globalization, natural resources, financial development, and carbon emissions from 1980 to 2017. The NARDL method has the benefit of discriminating the long-term and short-term asymmetric carbon emission responses due to a positive and negative shock in our primary variables of interest. Mainly, the findings of NARDL estimations confirm that positive shocks in globalization and financial developments have a significant positive impact on carbon emissions, whereas negative shock in natural resources has a significant positive impact on carbon emissions. Similarly, the outcomes of continuous wavelet transformation and wavelet transformation coherence confirm the causal linkages between covariates; however, this effect varies across different time and frequency domains. These results imply that environmental researchers should consider asymmetric transmission channels and time–frequency associations among variables to devise long-term sustainable policies.

Relationship Between the Scale, Structure, Efficiency and Economic Growth of Tobacco Financial Development in China

Objectives: This paper analyzes and studies the relationship between the scale, structure, efficiency and economic growth of tobacco financial development in China. Methods: Through the research on the theory of supply chain finance, this paper studies the products and application of the financial chain in the tobacco industry by using the methods of case analysis, literature research and case analysis. At the same time, taking the products of a bank as an example, this paper describes the product handling and operation process in detail, and analyzes the advantages and disadvantages of the products. Results: Commercial banks at home and abroad have gradually realized the power of the vigorous development of tobacco financial supply chain and actively developed tobacco supply chain financial products. The promotion of China's bank supply chain financial products at this stage will help banks to improve and adjust the traditional credit business structure. At the same time, it helps to improve and optimize the structure of tobacco customers and enhance the business cooperation between tobacco companies and banks. This can reduce the business risk of the tobacco industry and improve the overall profitability of the tobacco industry. Conclusion: The tobacco industry should steadily take advantage of the organization and coordination advantages of the government and make use of development financial funds to overcome difficulties. Only by improving the design and enlarging the leverage of financial support policies can the tobacco industry further develop.