Does the Digital Economy Successfully Facilitate Carbon Emission Reduction in China? Green Technology Innovation Perspective

Abstract

How to reduce carbon emissions is a critical problem in the world, especially when the emerging economy grows and technology breakthrough happens frequently. In this study, we systematically evaluate China’s digital economy based on regional data experience and construct a nonlinear dynamic threshold model to incorporate a heterogeneous threshold of green technology innovation into the influential mechanism to figure out whether the digital economy can effectively reduce regional carbon emissions. According to the results, China’s digital economy currently shows a trend of overall upward and local fluctuation and there is a large ‘gap’ between the rich and poor. Interestingly, green technology innovation has a heterogeneous threshold effect between the digital economy and carbon emissions: a lesser level of green technology innovation promotes the carbon emission impact of the digital economy to a certain extent, but when green technology innovation rises and exceeds a threshold, the digital economy can dramatically inhibit regional carbon emissions. This study answers the question of how to use the threshold effect of green technology innovation to reduce carbon emissions in the digital economy, which has significant theoretical and practical value to reduce carbon emissions in developing countries.