Can the Development of Digital Inclusive Finance Curb Carbon Emissions?: A Spatial Panel Analysis for China Under the PVAR Approach

Achieving the goals of carbon peak and carbon neutrality is crucial for the balance of global economic development with carbon emissions reduction and ecological environment protection, which are essential for the sustainability of human development. Digital inclusive finance (DIF), as an emerging force capable of promoting economic growth and technological innovation, plays a significant role in curbing carbon emissions. By using the panel data of 30 provinces in China from 2011 to 2021 and employing the panel vector autoregression (PVAR) model, this study empirically investigates the impact of DIF on total carbon emissions (TCE) and carbon emission intensity (CEI) from the perspective of technological innovation. The results show that DIF significantly reduces TCE and CEI and can further decrease TCE and CEI by promoting the level of technological innovation. The results of the impulse response function (IRF) reveal that technological innovation has a more significant and volatile impact on CEI compared to its effect on TCE. Moreover, heterogeneity analysis suggests that the impact of DIF on the reduction in carbon emissions is characterized by regional heterogeneity, with the impact of DIF on TCE in the central regions being the most pronounced, significantly influenced by the spillover effects from the eastern regions. Further research finds that the western regions exhibit a more significant impact of technological innovation levels on CEI compared to the eastern regions, with a discernible trend towards the convergence of inter-provincial disparities in CEI in the process of development.