[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/a/eee/eneeco/v128y2023ics0140988323006771.html
   My bibliography  Save this article

Assessing the effect of green finance on energy inequality in China via household-level analysis

Author

Listed:
  • Lee, Chi-Chuan
  • Song, Hepeng
  • Lee, Chien-Chiang
Abstract
While previous research has investigated the determinants of urban–rural energy inequality (EI), the significance of green finance has rarely been examined. Using a comprehensive green finance development index and a Chinese provincial panel dataset, this research quantitatively investigates how green finance development impacts EI. Our empirical results reveal a significant U-shaped connection between green finance and urban–rural energy disparity, suggesting that moderate expansion of green finance can efficiently mitigate EI. In addition, this relationship is strongly pronounced in China's western region and is more prominently strengthened in provinces with higher energy activities and digital finance development levels but lower economic and social activity levels. These findings could be attributed to the nonlinear impacts of green finance on energy and industrial structure. Based on the findings, we propose several relevant policy recommendations to support China's plans for advancing the green economy and eradicating EI.

Suggested Citation

  • Lee, Chi-Chuan & Song, Hepeng & Lee, Chien-Chiang, 2023. "Assessing the effect of green finance on energy inequality in China via household-level analysis," Energy Economics, Elsevier, vol. 128(C).
    • Handle: RePEc:eee:eneeco:v:128:y:2023:i:c:s0140988323006771
    DOI: 10.1016/j.eneco.2023.107179
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0140988323006771
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.eneco.2023.107179?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Rongyan Liu & Deqing Wang & Li Zhang & Lihong Zhang, 2019. "Can green financial development promote regional ecological efficiency? A case study of China," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 95(1), pages 325-341, January.
    2. Dilaver, Zafer & Hunt, Lester C, 2011. "Modelling and forecasting Turkish residential electricity demand," Energy Policy, Elsevier, vol. 39(6), pages 3117-3127, June.
    3. Sun, Yunpeng & Guan, Weimin & Cao, Yuning & Bao, Qun, 2022. "Role of green finance policy in renewable energy deployment for carbon neutrality: Evidence from China," Renewable Energy, Elsevier, vol. 197(C), pages 643-653.
    4. Borensztein, E. & De Gregorio, J. & Lee, J-W., 1998. "How does foreign direct investment affect economic growth?1," Journal of International Economics, Elsevier, vol. 45(1), pages 115-135, June.
    5. Sylviane Guillaumont Jeanneney & Kangni Kpodar, 2011. "Financial Development and Poverty Reduction: Can There be a Benefit without a Cost?," Journal of Development Studies, Taylor & Francis Journals, vol. 47(1), pages 143-163.
    6. Lee, Chien-Chiang & Wang, Fuhao & Chang, Yu-Fang, 2023. "Does green finance promote renewable energy? Evidence from China," Resources Policy, Elsevier, vol. 82(C).
    7. Lu, Shibao & Lu, Wenjing & Xu, Meng & Taghizadeh-Hesary, Farhad & Tang, Yao, 2023. "Water-energy-food security under green finance constraints in Southwest China," Energy Economics, Elsevier, vol. 118(C).
    8. Xue, Yan & Hu, Dongmei & Irfan, Muhammad & Wu, Haitao & Hao, Yu, 2023. "Natural resources policy making through finance? The role of green finance on energy resources poverty," Resources Policy, Elsevier, vol. 85(PA).
    9. Tiwari, Aviral Kumar & Trabelsi, Nader & Abakah, Emmanuel Joel Aikins & Nasreen, Samia & Lee, Chien-Chiang, 2023. "An empirical analysis of the dynamic relationship between clean and dirty energy markets," Energy Economics, Elsevier, vol. 124(C).
    10. Quang-Thanh Ngo & Hoa Anh Tran & Hai Thi Thanh Tran, 2021. "The impact of green finance and Covid-19 on economic development: capital formation and educational expenditure of ASEAN economies," China Finance Review International, Emerald Group Publishing Limited, vol. 12(2), pages 261-279, October.
    11. Chen, Maozhi & Sinha, Avik & Hu, Kexiang & Shah, Muhammad Ibrahim, 2021. "Impact of technological innovation on energy efficiency in industry 4.0 era: Moderation of shadow economy in sustainable development," Technological Forecasting and Social Change, Elsevier, vol. 164(C).
    12. Lee, Chien-Chiang & Wang, Fuhao, 2022. "How does digital inclusive finance affect carbon intensity?," Economic Analysis and Policy, Elsevier, vol. 75(C), pages 174-190.
    13. Shimei Wu & Xinye Zheng & Chu Wei, 2017. "Measurement of inequality using household energy consumption data in rural China," Nature Energy, Nature, vol. 2(10), pages 795-803, October.
    14. Zameer, Hashim & Yasmeen, Humaira & Wang, Rong & Tao, Jing & Malik, Muhammad Nasir, 2020. "An empirical investigation of the coordinated development of natural resources, financial development and ecological efficiency in China," Resources Policy, Elsevier, vol. 65(C).
    15. Duro, Juan Antonio & Padilla, Emilio, 2011. "Inequality across countries in energy intensities: An analysis of the role of energy transformation and final energy consumption," Energy Economics, Elsevier, vol. 33(3), pages 474-479, May.
    16. Lee, Chien-Chiang & Zhao, Ya-Nan, 2023. "Heterogeneity analysis of factors influencing CO2 emissions: The role of human capital, urbanization, and FDI," Renewable and Sustainable Energy Reviews, Elsevier, vol. 185(C).
    17. Chi-Chuan Lee & Boxu Zhou & Tsung-Yu Yang & Chin-Hsien Yu & Jinsong Zhao, 2023. "The Impact of Urbanization on CO2 Emissions in China: The Key Role of Foreign Direct Investment," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 59(2), pages 451-462, January.
    18. Dikau, Simon & Volz, Ulrich, 2021. "Central bank mandates, sustainability objectives and the promotion of green finance," Ecological Economics, Elsevier, vol. 184(C).
    19. Wu, Haitao & Hao, Yu & Ren, Siyu, 2020. "How do environmental regulation and environmental decentralization affect green total factor energy efficiency: Evidence from China," Energy Economics, Elsevier, vol. 91(C).
    20. Andadari, Roos Kities & Mulder, Peter & Rietveld, Piet, 2014. "Energy poverty reduction by fuel switching. Impact evaluation of the LPG conversion program in Indonesia," Energy Policy, Elsevier, vol. 66(C), pages 436-449.
    21. Lin, Faqin & Fu, Dahai, 2016. "Trade, Institution Quality and Income Inequality," World Development, Elsevier, vol. 77(C), pages 129-142.
    22. Ge, Tao & Cai, Xuesen & Song, Xiaowei, 2022. "How does renewable energy technology innovation affect the upgrading of industrial structure? The moderating effect of green finance," Renewable Energy, Elsevier, vol. 197(C), pages 1106-1114.
    23. Chung‐Hua Shen & Chien‐Chiang Lee & Chi‐Chuan Lee, 2010. "What Makes International Capital Flows Promote Economic Growth? An International Cross‐Country Analysis," Scottish Journal of Political Economy, Scottish Economic Society, vol. 57(5), pages 515-546, November.
    24. Guanchun Liu, Yuanyuan Liu, and Chien-Chiang Lee, 2020. "Growth Sources of Green Economy and Energy Consumption in China: New Evidence Accounting for Heterogeneous Regimes," The Energy Journal, International Association for Energy Economics, vol. 0(Number 6), pages 33-54.
    25. Nguyen, Canh Phuc & Nasir, Muhammad Ali, 2021. "An inquiry into the nexus between energy poverty and income inequality in the light of global evidence," Energy Economics, Elsevier, vol. 99(C).
    26. Alcantara, Vicent & Duro, Juan Antonio, 2004. "Inequality of energy intensities across OECD countries: a note," Energy Policy, Elsevier, vol. 32(11), pages 1257-1260, July.
    27. Md Abdullah Omar & Kazuo Inaba, 2020. "Does financial inclusion reduce poverty and income inequality in developing countries? A panel data analysis," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 9(1), pages 1-25, December.
    28. Yang, Yuxue & Su, Xiang & Yao, Shuangliang, 2021. "Nexus between green finance, fintech, and high-quality economic development: Empirical evidence from China," Resources Policy, Elsevier, vol. 74(C).
    29. Li, Ke & Lin, Boqiang, 2016. "Impact of energy conservation policies on the green productivity in China’s manufacturing sector: Evidence from a three-stage DEA model," Applied Energy, Elsevier, vol. 168(C), pages 351-363.
    30. Huang, Lei & Wang, Chenhao & Chin, Tachia & Huang, Jiahe & Cheng, Xuanmei, 2022. "Technological knowledge coupling and green innovation in manufacturing firms: Moderating roles of mimetic pressure and environmental identity," International Journal of Production Economics, Elsevier, vol. 248(C).
    31. Bouzarovski, Stefan & Simcock, Neil, 2017. "Spatializing energy justice," Energy Policy, Elsevier, vol. 107(C), pages 640-648.
    32. Zhao, Jun & Dong, Kangyin & Dong, Xiucheng & Shahbaz, Muhammad, 2022. "How renewable energy alleviate energy poverty? A global analysis," Renewable Energy, Elsevier, vol. 186(C), pages 299-311.
    33. Brunnschweiler, Christa N., 2010. "Finance for renewable energy: an empirical analysis of developing and transition economies," Environment and Development Economics, Cambridge University Press, vol. 15(3), pages 241-274, June.
    34. Sharma, Gagan Deep & Sarker, Tapan & Rao, Amar & Talan, Gaurav & Jain, Mansi, 2022. "Revisiting conventional and green finance spillover in post-COVID world: Evidence from robust econometric models," Global Finance Journal, Elsevier, vol. 51(C).
    35. Nguyen, Canh Phuc & Su, Thanh Dinh, 2022. "The influences of government spending on energy poverty: Evidence from developing countries," Energy, Elsevier, vol. 238(PA).
    36. Asteriou, Dimitrios & Dimelis, Sophia & Moudatsou, Argiro, 2014. "Globalization and income inequality: A panel data econometric approach for the EU27 countries," Economic Modelling, Elsevier, vol. 36(C), pages 592-599.
    37. Lee, Chien-Chiang & Yuan, Zihao, 2024. "Impact of energy poverty on public health: A non-linear study from an international perspective," World Development, Elsevier, vol. 174(C).
    38. Sovacool, Benjamin K. & Burke, Matthew & Baker, Lucy & Kotikalapudi, Chaitanya Kumar & Wlokas, Holle, 2017. "New frontiers and conceptual frameworks for energy justice," Energy Policy, Elsevier, vol. 105(C), pages 677-691.
    39. Qiang Wang & Jie Fan & Mei-Po Kwan & Kan Zhou & Guofeng Shen & Na Li & Bowei Wu & Jian Lin, 2023. "Examining energy inequality under the rapid residential energy transition in China through household surveys," Nature Energy, Nature, vol. 8(3), pages 251-263, March.
    40. Dong, Kangyin & Ren, Xiaohang & Zhao, Jun, 2021. "How does low-carbon energy transition alleviate energy poverty in China? A nonparametric panel causality analysis," Energy Economics, Elsevier, vol. 103(C).
    41. Lyu, Yanwei & Wu, You & Zhang, Jinning, 2023. "How industrial structure distortion affects energy poverty? Evidence from China," Energy, Elsevier, vol. 278(C).
    42. Ren, Yi-Shuai & Jiang, Yong & Narayan, Seema & Ma, Chao-Qun & Yang, Xiao-Guang, 2022. "Marketisation and rural energy poverty: Evidence from provincial panel data in China," Energy Economics, Elsevier, vol. 111(C).
    43. von Borgstede, Chris & Andersson, Maria & Johnsson, Filip, 2013. "Public attitudes to climate change and carbon mitigation—Implications for energy-associated behaviours," Energy Policy, Elsevier, vol. 57(C), pages 182-193.
    44. Rao, P. Sharath Chandra & Miller, Jeffrey B. & Wang, Young Doo & Byrne, John B., 2009. "Energy-microfinance intervention for below poverty line households in India," Energy Policy, Elsevier, vol. 37(5), pages 1694-1712, May.
    45. Sanya Carley & David M. Konisky, 2020. "The justice and equity implications of the clean energy transition," Nature Energy, Nature, vol. 5(8), pages 569-577, August.
    46. Boukhatem, Jamel, 2016. "Assessing the direct effect of financial development on poverty reduction in a panel of low- and middle-income countries," Research in International Business and Finance, Elsevier, vol. 37(C), pages 214-230.
    47. Haiyan Zhang & Michael L. Lahr & Jun Bi, 2016. "Challenges of green consumption in China: a household energy use perspective," Economic Systems Research, Taylor & Francis Journals, vol. 28(2), pages 183-201, June.
    48. Dong, Kangyin & Taghizadeh-Hesary, Farhad & Zhao, Jun, 2022. "How inclusive financial development eradicates energy poverty in China? The role of technological innovation," Energy Economics, Elsevier, vol. 109(C).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wang, Hai-Jie & Zheng, Mei-Qi & Yin, Hua-Tang & Chang, Chun-Ping, 2024. "Green innovation, industrial structure and urban eco-efficiency in Chinese cities," Economic Analysis and Policy, Elsevier, vol. 82(C), pages 1011-1024.
    2. Lee, Chi-Chuan & Song, Hepeng & An, Jiafu, 2024. "The impact of green finance on energy transition: Does climate risk matter?," Energy Economics, Elsevier, vol. 129(C).
    3. Zhao, Congyu & Dong, Kangyin & Lee, Chien-Chiang, 2024. "Carbon lock-in endgame: Can energy trilemma eradication contribute to decarbonization?," Energy, Elsevier, vol. 293(C).
    4. Lee, Chi-Chuan & Li, Yong-Yi, 2024. "Does environmental policy matter for renewable energy production and economic activity? Evidence from Granger causality in quantiles," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 225-237.
    5. Asafo-Adjei, Emmanuel & Tiwari, Aviral Kumar & Abakah, Emmanuel Joel Aikins & Lee, Chi-Chuan, 2024. "Risk synchronization in Australia stock market: A sector analysis," International Review of Economics & Finance, Elsevier, vol. 93(PA), pages 582-610.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Xue, Yan & Hu, Dongmei & Irfan, Muhammad & Wu, Haitao & Hao, Yu, 2023. "Natural resources policy making through finance? The role of green finance on energy resources poverty," Resources Policy, Elsevier, vol. 85(PA).
    2. Wang, Xiong & Yang, Wanping & Ren, Xiaohang & Lu, Zudi, 2023. "Can financial inclusion affect energy poverty in China? Evidence from a spatial econometric analysis," International Review of Economics & Finance, Elsevier, vol. 85(C), pages 255-269.
    3. Lee, Chi-Chuan & Lee, Chien-Chiang, 2022. "How does green finance affect green total factor productivity? Evidence from China," Energy Economics, Elsevier, vol. 107(C).
    4. Dong, Kangyin & Taghizadeh-Hesary, Farhad & Zhao, Jun, 2022. "How inclusive financial development eradicates energy poverty in China? The role of technological innovation," Energy Economics, Elsevier, vol. 109(C).
    5. Dou, Yue & Zhao, Jun & Dong, Xiucheng & Dong, Kangyin, 2021. "Quantifying the impacts of energy inequality on carbon emissions in China: A household-level analysis," Energy Economics, Elsevier, vol. 102(C).
    6. Yin, Zhichao & Wang, Rui & Wu, Xi, 2023. "Financial inclusion, natural disasters and energy poverty: Evidence from China," Energy Economics, Elsevier, vol. 126(C).
    7. Lee, Chien-Chiang & Wang, Chang-song, 2022. "Financial development, technological innovation and energy security: Evidence from Chinese provincial experience," Energy Economics, Elsevier, vol. 112(C).
    8. Siyou Xia & Yu Yang & Xiaoying Qian & Xin Xu, 2022. "Spatiotemporal Interaction and Socioeconomic Determinants of Rural Energy Poverty in China," IJERPH, MDPI, vol. 19(17), pages 1-15, August.
    9. Li, Songran & Shao, Qinglong, 2022. "Greening the finance for climate mitigation: An ARDL–ECM approach," Renewable Energy, Elsevier, vol. 199(C), pages 1469-1481.
    10. Kocak, Emrah & Ulug, Eyup Emre & Oralhan, Burcu, 2023. "The impact of electricity from renewable and non-renewable sources on energy poverty and greenhouse gas emissions (GHGs): Empirical evidence and policy implications," Energy, Elsevier, vol. 272(C).
    11. Di Chen & Haiqing Hu & Chun‐Ping Chang, 2023. "Green finance, environment regulation, and industrial green transformation for corporate social responsibility," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(5), pages 2166-2181, September.
    12. Guo, Qing & You, Wenlan, 2024. "How can the digital economy alleviate multidimensional energy poverty? —Empirical evidence of 21 prefecture-level cities in Guangdong Province," Energy, Elsevier, vol. 301(C).
    13. Upham, Dr Paul & Sovacool, Prof Benjamin & Ghosh, Dr Bipashyee, 2022. "Just transitions for industrial decarbonisation: A framework for innovation, participation, and justice," Renewable and Sustainable Energy Reviews, Elsevier, vol. 167(C).
    14. Zhang, Dongyang, 2023. "Does green finance really inhibit extreme hypocritical ESG risk? A greenwashing perspective exploration," Energy Economics, Elsevier, vol. 121(C).
    15. Muhammad Shafiullah & Zhilun Jiao & Muhammad Shahbaz & Kangyin Dong, 2023. "Examining energy poverty in Chinese households: An Engel curve approach," Australian Economic Papers, Wiley Blackwell, vol. 62(1), pages 149-184, March.
    16. Moteng, Ghislain & Raghutla, Chandrashekar & Njangang, Henri & Nembot, Luc Ndeffo, 2023. "International sanctions and energy poverty in target developing countries," Energy Policy, Elsevier, vol. 179(C).
    17. Zhao, Congyu & Dong, Kangyin & Jiang, Hong-Dian & Wang, Kun & Dong, Xiucheng, 2023. "How does energy poverty eradication realize the path to carbon unlocking? The case of China," Energy Economics, Elsevier, vol. 121(C).
    18. Bianco, V. & Proskuryakova, L. & Starodubtseva, A., 2021. "Energy inequality in the Eurasian Economic Union," Renewable and Sustainable Energy Reviews, Elsevier, vol. 146(C).
    19. Sun, Shuyu & Tong, Kangkang, 2024. "Rural-urban inequality in energy use sufficiency and efficiency during a rapid urbanization period," Applied Energy, Elsevier, vol. 364(C).
    20. Lee, Chien-Chiang & Wang, Chang-song & He, Zhiwen & Xing, Wen-wu & Wang, Keying, 2023. "How does green finance affect energy efficiency? The role of green technology innovation and energy structure," Renewable Energy, Elsevier, vol. 219(P1).

    More about this item

    Keywords

    Green finance; Energy inequality; Urban–rural inequality; China;
    All these keywords.

    JEL classification:

    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:eneeco:v:128:y:2023:i:c:s0140988323006771. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eneco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.