The nexus of green investment, high-quality economic development, and carbon emissions in China: evidence according to an ARDL-ECM approach

Previous studies examined the impact of finance on CO2 emissions; however, relatively few studies have explored the role of green investment in carbon reduction. In this study, we assessed the relationship between green investment, high-quality economic development, and carbon emissions in China. Based on the evaluation of three first-level indicators of economic development, social life, and ecological environment from 2001 to 2020, the index of China's high-quality economic development level was calculated and performed analysis using an autoregression-distributed lag error-correction model. The results confirmed a long-term cointegration relationship between the three variables in China. In the long term, green investment is conducive to high-quality economic development and carbon-emissions reduction. During the process of high-quality economic development, carbon emissions will be reduced, and high-quality economic development and carbon emission reduction are also conducive to the increase of green investment. Second, in the short term, high-quality economic development and green investment demonstrate different mechanisms of influence on carbon emissions during the lag period. These findings suggest that investment in green energy should be strengthened, and the concept of green development should be adhered to in order to promote green economy to help improve China's environmental quality.