Digital finance and greener emissions: evidence from China

Existing research on finance mainly focuses on credit, and there are few studies on the pollution reduction effects of digital finance. Based on a sample of 278 cities from 2011 to 2019, this article empirically examines the impact of digital finance on greener emissions. We find that digital finance, particularly in its usage depth, reduces industrial waste gas emissions, and exhibits a significant green emission effect. After using robustness tests such as Bartik instrument as an instrumental variable for digital finance, our conclusions still hold. Mechanism analysis finds that supporting green credit projects and promoting public energy conservation are the critical path for digital finance to enhance greener emissions. Furthermore, we compare the roles of traditional finance and digital finance in greener emissions, and find that digital finance reduces industrial waste gas emissions, while traditional finance is not conducive to emission reduction.