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Anhui University of Technology

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Heterogeneous Effects of Green Finance on Urban Decarbonization: Evidence from 285 Cities in China

Jun 05, 2026

This study addresses the ambiguous empirical effectiveness and underlying mechanisms of green finance in facilitating urban low-carbon transitions, particularly the lack of systematic analysis on heterogeneity and regional disparities. Leveraging a dataset covering 285 Chinese cities, the authors integrate econometric and machine learning approaches to evaluate the impact of green finance on carbon intensity and its transmission channels through energy structure optimization and industrial upgrading. The findings reveal that the carbon-mitigation effects of green finance are more pronounced in cities characterized by weaker technological capabilities, higher industrial dependence, and greater coal consumption shares. Green bonds and green investments exhibit the strongest efficacy and generate significant spatial spillovers, with tier-four and tier-five cities deriving the greatest benefits. These results provide empirical support for designing a multi-tiered and differentiated green finance system.

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Heterogeneous Effects of Green Finance on Urban Decarbonization: Evidence from 285 Cities in China

Jun 05, 2026

This study addresses the ambiguous empirical effectiveness and underlying mechanisms of green finance in facilitating urban low-carbon transitions, particularly the lack of systematic analysis on heterogeneity and regional disparities. Leveraging a dataset covering 285 Chinese cities, the authors integrate econometric and machine learning approaches to evaluate the impact of green finance on carbon intensity and its transmission channels through energy structure optimization and industrial upgrading. The findings reveal that the carbon-mitigation effects of green finance are more pronounced in cities characterized by weaker technological capabilities, higher industrial dependence, and greater coal consumption shares. Green bonds and green investments exhibit the strongest efficacy and generate significant spatial spillovers, with tier-four and tier-five cities deriving the greatest benefits. These results provide empirical support for designing a multi-tiered and differentiated green finance system.

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