Digital Economy Development, Industrial Structure Upgrading and Green Total Factor Productivity: Empirical Evidence from China’s Cities

Abstract

The digital economy is an important engine to promote sustainable economic growth. Exploring the mechanism by which the digital economy promotes economic development, industrial upgrading and environmental improvement is an issue worth studying. This paper takes China as an example for study and uses the data of 286 cities from 2011 to 2019. In the empirical analysis, the direction distance function (DDF) and the Global Malmquist-Luenberger (GML) productivity index methods are used to measure the green total factor productivity (GTFP), while Tobit, quantile regression, impulse response function and intermediary effect models are used to study the relationship among digital economy development, industrial structure upgrading and GTFP. The results show that: (1) The digital economy can significantly improve China’s GTFP; however, there are clear regional differences. (2) The higher the GTFP, the greater the promotion effect of the digital economy on the city’s GTFP. (3) From a dynamic long-term perspective, the digital economy has indeed positively promoted China’s GTFP. (4) The upgrading of industrial structures is an intermediary transmission mechanism for the digital economy to promote GTFP. This paper provides a good reference for driving green economic growth and promoting the environment.