Mechanism testing of the empowerment of green transformation and upgrading of industry by the digital economy in China

Abstract

With the continuous advancement of industrialization, global environmental problems are becoming increasingly severe. Maintaining economic growth while improving the environment has been an important issue for many countries, especially developing countries. As industry is a major source of environmental pollution, industrial green transformation and upgrading have become particularly important. In the era of the digital economy (DE), there is a new path for industrial green transformation and upgrading. Based on provincial data on industry from 2008 to 2021, a difference-in-differences (DID) model was constructed to analyze the environmental and economic benefits. New pathways for trade-offs between environmental improvement and economic growth in China are presented. In addition, new ideas are concerning global environmental issues and economic issues in the DE are presented. The present study indicates that the DE has reduced the intensity of pollution emissions and elevated total factor productivity (TFP), which has helped to promote industrial green transformation and upgrading. Further mechanism testing showed that the DE has promoted industrial green transformation and upgrading by improving the utilization of energy and resources and promoting technological innovation. Considering the utilization of energy and resources, the DE has decreased China’s total industrial consumption of energy and coal, reduced industrial water consumption, and reduced the share of coal consumption and increased the share of clean energy consumption in China’s total industrial energy consumption; these effects have optimized the efficiency and structure of China’s energy utilization to contribute to the green transformation and upgrading of industry. Regarding technological innovation, the development of the DE has increased industrial innovation output and R&D input. Furthermore, it has promoted innovation with respect to green processes, accelerating technological innovation, and realized industrial green transformation and upgrading.