Foreign direct investment, financial development, energy consumption, and air quality: A way for carbon neutrality in China.

Air quality is a social, economical, and health issue for fast-developing countries such as China. Due to the overuse of nonrenewable energy, industrialization, and the population put pressure on air quality, which seriously threatens public health and economic growth. This study focuses on air quality and also aims to investigate the short-and long-run correlation between foreign direct investment, energy consumption, domestic credit, and financial development. The Autoregressive distributed lag model and the Granger non-causality test were carried out over the period from 1985 to 2018. The main findings of this study show a positive and significant long-run impact of energy consumption on air quality. In addition, domestic credit and financial development similarly show a significant positive short-run association with air quality. Moreover, the unidirectional causality correlation running from foreign direct investment and domestic credit to air quality was concluded by the Granger non-causality test. Considering the empirical analysis, this study suggests that domestic financial institutions should offer credit to industries at a low-interest rate in order to help them to switch from non-renewable to renewable energy consumption towards the promotion of sustainable and healthy air quality.

Exploring the impact of technological innovation, environmental regulations and urbanization on ecological efficiency of China in the context of COP21.

The objective of this study was to explore the roles of technological innovation, environmental regulations, and urbanization in ecological efficiency within the context of the 2015 Paris agreement. Initially, the study employed the super-efficiency DEA model to estimate the ecological efficiencies of 30 regions in China. Following this, the system GMM method was used to explore the impacts of technological innovation, environmental regulations, and urbanization on ecological efficiency. We used annual data from 2008 to 2018. The results indicate that, in terms of ecological efficiency, the eastern region was the highest ranked, followed by central and western regions, respectively. The urbanization index has a negative impact on ecological efficiency at a national level. However, in the context of regions, it is positively significant in the eastern region, while the results in the central and western regions are insignificant. The influence of technological innovation on ecological efficiency is found to be significantly positive at both national and regional levels. It is generally perceived that environmental regulations are pivotal for sustainability. Our results verify this argument and indicate that environmental regulations have a positive impact on ecological efficiency in the central and eastern regions. However, their impact is found to be negative in the western region. Policy suggestions are discussed, in order to further strengthen environmental laws and sustainability.