Assessing the impact of digital financial inclusion on PM2.5 concentration: evidence from China
Assessing the impact of digital financial inclusion on PM2.5 concentration: evidence from China
Digital finance as a new technology-driven business model shortens the distance between borrowers and lenders. Economic research finds that digital finance promotes economic efficiency by reducing transaction costs, information asymmetry, and inequality. Digital finance is an energy-intensive industry; therefore, increased efficiency in the industry should yield environmental benefits. We examine the externality of digital finance on air pollution. By analyzing data on digital financial inclusion and fine particulate matter concentration in China, we demonstrate using a dynamic panel data model that the development of digital finance damages the environment. However, after incorporating a threshold effect into a kink model, we determine that digital finance reduces pollution when its development exceeds a certain level. The results suggest that a high level of digital finance development not only increases economic growth but also improves air quality; this result provides novel insight into the relationship between economic growth and the environment. Graphical abstract: [Figure not available: see fulltext.]
Digital finance, GMM, PM concentration, Threshold model
Yang, Lu
137d4b84-e283-4d52-be57-b9857c9e0ba1
Wang, Lulu
165de7f6-5dac-4157-b1cd-943d7af3f28d
Ren, Xiaohang
970abdf4-ff20-4244-9952-f9ee910736ee
Yang, Lu
137d4b84-e283-4d52-be57-b9857c9e0ba1
Wang, Lulu
165de7f6-5dac-4157-b1cd-943d7af3f28d
Ren, Xiaohang
970abdf4-ff20-4244-9952-f9ee910736ee
Yang, Lu, Wang, Lulu and Ren, Xiaohang
(2021)
Assessing the impact of digital financial inclusion on PM2.5 concentration: evidence from China.
Environmental Science and Pollution Research.
(doi:10.1007/s11356-021-17030-3).
Abstract
Digital finance as a new technology-driven business model shortens the distance between borrowers and lenders. Economic research finds that digital finance promotes economic efficiency by reducing transaction costs, information asymmetry, and inequality. Digital finance is an energy-intensive industry; therefore, increased efficiency in the industry should yield environmental benefits. We examine the externality of digital finance on air pollution. By analyzing data on digital financial inclusion and fine particulate matter concentration in China, we demonstrate using a dynamic panel data model that the development of digital finance damages the environment. However, after incorporating a threshold effect into a kink model, we determine that digital finance reduces pollution when its development exceeds a certain level. The results suggest that a high level of digital finance development not only increases economic growth but also improves air quality; this result provides novel insight into the relationship between economic growth and the environment. Graphical abstract: [Figure not available: see fulltext.]
Text
Assessing the impact of digital financial inclusion on PM2.5 concentration- evidence from China
- Accepted Manuscript
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Accepted/In Press date: 11 October 2021
e-pub ahead of print date: 18 November 2021
Keywords:
Digital finance, GMM, PM concentration, Threshold model
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Local EPrints ID: 453002
URI: http://eprints.soton.ac.uk/id/eprint/453002
ISSN: 0944-1344
PURE UUID: ebabcfa7-9102-4199-b67c-11242b69e182
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Date deposited: 07 Jan 2022 12:21
Last modified: 17 Mar 2024 07:02
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Author:
Lu Yang
Author:
Xiaohang Ren
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