IMPACT OF DIGITAL ECONOMY DEVELOPMENT ON CARBON EMISSIONS IN CHINA

Abstract

This study uses the panel quantile regression model and conducts path analysis to examine the impact of inter-provincial digital economy development in China on carbon emission reduction. Results reveal several key points: First, the impact of digital economy development on carbon emission reduction varies significantly across quantiles; it can promote or inhibit emissions and shows an inverted “U” relationship. Second, the inhibition effect of the digital economy on carbon emissions is significantly stronger than the growth effect. Third, more than half of the studied regions show an inhibitory effect of the digital economy on carbon emissions, primarily through indirect impact paths. Among these paths, the three most significant ones are the improvement of urbanization level, resident affluence level, and per capita gross domestic product (GDP). Policy recommendations are discussed.