Empirical Analysis of the Impact of Green Finance and Technological Progress on Total Factor Productivity in China’s Industrial Sector

Abstract

The enhancement of industrial green total factor productivity is pivotal for achieving high-quality and sustainable economic development. This study assesses China’s performance using the SBM-GML model, employing province-level panel data spanning from 2004 to 2020. Furthermore, we examine the influence of green finance and technological progress on industrial green total factor productivity using a spatial econometric model. The findings uncover that the relationship between the level of green financial development and industrial green total factor productivity follows a U-shaped curve. Initially, low levels of green financial development exert a suppressive effect on industrial green total factor productivity, proving ineffective in the short term. However, with the progression of green finance development, a positive and significant long-term impact on industrial green total factor productivity emerges. Moreover, technological progress demonstrates a noteworthy promotional effect on industrial green total factor productivity. The analysis delves deeper into revealing that industrial structure and environmental regulation intensity exhibit a significant negative relationship with industrial green total factor productivity. In contrast, both energy structure and education level showcase a substantial positive relationship with industrial green total factor productivity.