Welcome to Scholar Publishing Group

International Journal of Social Sciences and Economic Management, 2025, 6(1); doi: 10.38007/IJSSEM.2025.060114.

Examining the Influence and Mechanisms of the Digital Economy on Urban Green Total Factor Energy Efficiency: Evidence from 240 Cities in China

Author(s)

Jun Xu and Wenbo Song

Corresponding Author:
Wenbo Song
Affiliation(s)

Associate Professor, School of Economics and Management, Xinjiang University, Urumqi 830046, China

Abstract

The digital economy has emerged as a pivotal driver in enhancing the green total energy efficiency of cities. Utilizing panel data from 240 prefecture-level cities in China spanning 2011 to 2022, this study develops an index system to evaluate urban digital economy development across five dimensions: digital infrastructure, digital industry, digital finance, digital innovation, and digital economic policy support. The analysis reveals that urban digital economy's advancement significantly enhances urban green total factor energy efficiency, persisting across various robustness tests. Moreover, the digital economy improves urban green total factor energy efficiency by fostering green technology innovation and advancing energy electrification. Notably, digital finance and digital innovation exhibit a more substantial impact on urban green total factor energy efficiency, with coastal cities and key environmental protection cities showing a more pronounced effect. The threshold effect analysis further indicates a dual threshold effect for new quality productive forces, where the digital economy exerts a significant influence on green total factor energy efficiency once these forces surpass the second threshold. Consequently, it is recommended to promote the development of the urban digital economy to comprehensively enhance energy use efficiency and establish a green, low-carbon urban energy system.

Keywords

Digital economy; Green total factor energy efficiency; Green technology innovation; Energy electrification level; New quality productive forces

Cite This Paper

Jun Xu and Wenbo Song. Examining the Influence and Mechanisms of the Digital Economy on Urban Green Total Factor Energy Efficiency: Evidence from 240 Cities in China. International Journal of Social Sciences and Economic Management (2025), Vol. 6, Issue 1: 157-178. https://doi.org/10.38007/IJSSEM.2025.060114.

References

[1] Ahmed, J., Raies, Farooq, U., & Subhani, B. H., 2022. The moderating role of information and communication technology in the nexus between financial development, economic growth and energy consumption. OPEC Energy Review, 46(4), 399–412. https://doi.org/10.1111/opec.12262

[2] Al-Refaie, A., Hammad, M., & Li, M.-H., 2016. DEA window analysis and malmquist index to assess energy efficiency and productivity in jordanian industrial sector. Energy Efficiency, 9(6), 1299–1313. https://doi.org/10.1007/s12053-016-9424-0

[3] Berkhout, F., Hertin, J., 2001. Impacts of information and communication technologies on environmental sustainability: Speculations and evidence.  Report to the OECD, Brighton, 21.

[4] Chen, Y., Xu, S., Lyulyov, O., Pimonenko, T., 2023. China’s Digital Economy Development: Incentives and Challenges. TECHNOLOGICAL AND ECONOMIC DEVELOPMENT OF ECONOMY 29, 518–538. https://doi.org/10.3846/tede.2022.18018

[5] Crompton, P., Wu, Y., 2005. Energy consumption in China: Past trends and future directions. Energy Econ. 27, 195–208. https://doi.org/10.1016/j.eneco.2004.10.006

[6] Dian, J., Song, T., Li, S., 2024. Facilitating or inhibiting? Spatial effects of the digital economy affecting urban green technology innovation. Energy Econ. 129, 107223. https://doi.org/10.1016/j.eneco.2023.107223

[7] Du, K., Li, J., 2019. Towards a green world: How do green technology innovations affect total-factor carbon productivity. Energy Policy 131, 240–250. https://doi.org/10.1016/j.enpol.2019.04.033

[8] Gao, D., Li, G., Yu, J., 2022a. Does digitization improve green total factor energy efficiency? Evidence from Chinese 213 cities. Energy 247, 123395. https://doi.org/10.1016/j.energy.2022.123395

[9] Gao, D., Li, G., Yu, J., 2022b. Does digitization improve green total factor energy efficiency? Evidence from Chinese 213 cities. Energy 247, 123395. https://doi.org/10.1016/j.energy.2022.123395

[10] Ge, Y., Xia, Y., Wang, T., 2024. Digital economy, data resources and enterprise green technology innovation: Evidence from a-listed Chinese firms. Resources Pol. 92, 105035. https://doi.org/10.1016/j.resourpol.2024.105035

[11] Hu, J.-L., Wang, S.-C., 2006. Total-factor energy efficiency of regions in China. Energy Policy 34, 3206–3217. https://doi.org/10.1016/j.enpol.2005.06.015

[12] Huang, S., Chen, L., 2023a. The impact of the digital economy on the urban total-factor energy efficiency: Evidence from 275 cities in China. Sustainability 15, 3195. https://doi.org/10.3390/su15043195

[13] Huang, S., Chen, L., 2023b. The impact of the digital economy on the urban total-factor energy efficiency: Evidence from 275 cities in China. SUSTAINABILITY 15, 3195. https://doi.org/10.3390/su15043195

[14] Huang, S., Chen, L., 2023c. The impact of the digital economy on the urban total-factor energy efficiency: Evidence from 275 cities in China. Sustainability 15, 3195. https://doi.org/10.3390/su15043195

[15] Ji, Z., Zhao, L., Song, X., Gao, X., 2023. Digital economy impact on inclusive green growth: Intermediary and spatial spillover effects in China. Environ. Sci. Pollut. R. 30, 123657–123678. https://doi.org/10.1007/s11356-023-30898-7

[16] Li, X., Ma, D., 2021. Financial agglomeration, technological innovation, and green total factor energy efficiency. Alexandria Engineering Journal 60, 4085–4095. https://doi.org/10.1016/j.aej.2021.03.001

[17] Lin, B., Zhu, R., 2021. Energy efficiency of the mining sector in China, what are the main influence factors? Resources, Conservation and Recycling 167, 105321. https://doi.org/10.1016/j.resconrec.2020.105321

[18] Liu, B., 2023. An analysis of energy efficiency of the pearl river delta of China based on super-efficiency SBM model and malmquist index. Environ. Sci. Pollut. R. 30, 18998–19011. https://doi.org/10.1007/s11356-022-23465-z

[19] Liu, L., Wang, Z., 2009. The development and application practice of wind–solar energy hybrid generation systems in China. Renewable and Sustainable Energy Reviews 13, 1504–1512. https://doi.org/10.1016/j.rser.2008.09.021

[20] Luo, K., Liu, Y., Chen, P.-F., Zeng, M., 2022. Assessing the impact of digital economy on green development efficiency in the yangtze river economic belt. Energy Econ. 112, 106127. https://doi.org/10.1016/j.eneco.2022.106127

[21] Luo, S., Yimamu, N., Li, Y., Wu, H., Irfan, M., Hao, Y., n.d. Digitalization and sustainable development: How could digital economy development improve green innovation in China? https://doi.org/10.1002/bse.3223

[22] Lyu, Y., Wang, W., Wu, Y., Zhang, J., 2023. How does digital economy affect green total factor productivity? Evidence from China. Science of The Total Environment 857, 159428. https://doi.org/10.1016/j.scitotenv.2022.159428

[23] Lyu, Y., Xiao, X., Zhang, J., 2024. Does the digital economy enhance green total factor productivity in China? The evidence from a national big data comprehensive pilot zone. Struct. Change Econ. Dynam. 69, 183–196. https://doi.org/10.1016/j.strueco.2023.12.009

[24] Ma, D., Zhu, Q., 2022. Innovation in emerging economies: Research on the digital economy driving high-quality green development. J. Bus. Res. 145, 801–813. https://doi.org/10.1016/j.jbusres.2022.03.041

[25] Qiao, P., Liu, S., Fung, H.-G., Wang, C., 2024. Corporate green innovation in a digital economy. Int. Rev. Econ. Financ. 92, 870–883. https://doi.org/10.1016/j.iref.2024.02.073

[26] Ren, Siyu, Hao, Y., Wu, H., 2022. The role of outward foreign direct investment (OFDI) on green total factor energy efficiency: Does institutional quality matters? Evidence from China. Resources Pol. 76, 102587. https://doi.org/10.1016/j.resourpol.2022.102587

[27] Ren, Shuming, Li, L., Han, Y., Hao, Y., Wu, H., 2022. The emerging driving force of inclusive green growth: Does digital economy agglomeration work? Busi. Stra. Envir. 31, 1656–1678. https://doi.org/10.1002/bse.2975

[28] Ren, Y., Zhang, X., Chen, H., 2022. The impact of new energy enterprises’ digital transformation on their total factor productivity: Empirical evidence from China. Sustainability 14, 13928. https://doi.org/10.3390/su142113928

[29] Shang, Y., Liu, H., Lv, Y., 2020. Total factor energy efficiency in regions of China: An empirical analysis on SBM-DEA model with undesired generation. Journal of King Saud University - Science 32, 1925–1931. https://doi.org/10.1016/j.jksus.2020.01.033

[30] Song, J., Liu, Z., Leng, X., 2024. The impact of the digital economy on provincial carbon emissions in China. Applied Spatial Analysis and Policy. https://doi.org/10.1007/s12061-024-09582-x

[31] Song, M., Pan, H., Vardanyan, M., Shen, Z., 2023. Evaluating the energy efficiency-enhancing potential of the digital economy: Evidence from China. J. Environ. Manage. 344, 118408. https://doi.org/10.1016/j.jenvman.2023.118408

[32] Tang, L., He, G., 2021. How to improve total factor energy efficiency? An empirical analysis of the yangtze river economic belt of China. Energy 235, 121375. https://doi.org/10.1016/j.energy.2021.121375

[33] Wang, H., Wang, Y., Zeng, G., Qian, Z., Lu, S., 2024. The differential impact of the digital economy on urban energy efficiency in China: The mediating mechanism of FDI. Environment, Development and Sustainability. https://doi.org/10.1007/s10668-024-04475-y

[34] Wang, S., Song, Y., Min Du, A., Liang, J., 2024. The digital economy and entrepreneurial dynamics: An empirical analysis of urban regions in China. Research in International Business and Finance 71, 102459. https://doi.org/10.1016/j.ribaf.2024.102459

[35] Wang, X., Zhong, M., 2023a. Can digital economy reduce carbon emission intensity? Empirical evidence from China’s smart city pilot policies. Environ. Sci. Pollut. R. 30, 51749–51769. https://doi.org/10.1007/s11356-023-26038-w

[36] Wang, X., Zhong, M., 2023b. Can digital economy reduce carbon emission intensity? Empirical evidence from China’s smart city pilot policies. Environ. Sci. Pollut. R. 30, 51749–51769. https://doi.org/10.1007/s11356-023-26038-w

[37] Wang, Y.F., Li, K.P., Xu, X.M., Zhang, Y.R., 2014. Transport energy consumption and saving in China. Renewable Sustainable Energy Rev. 29, 641–655. https://doi.org/10.1016/j.rser.2013.08.104

[38] Wang, Z., 2022. Measuring the total-factor green efficiency in China’s industrial sectors: A parametric approach. Discrete Dyn. Nat. Soc. 2022, 5634702. https://doi.org/10.1155/2022/5634702

[39] Wen, H., Liang, W., Lee, C.-C., 2022. Urban broadband infrastructure and green total-factor energy efficiency in China. UTILITIES POLICY 79, 101414. https://doi.org/10.1016/j.jup.2022.101414

[40] Wu, H., Hao, Y., Ren, S., Yang, X., Xie, G., 2021a. Does internet development improve green total factor energy efficiency? Evidence from China. Energy Policy 153, 112247. https://doi.org/10.1016/j.enpol.2021.112247

[41] Wu, H., Hao, Y., Ren, S., Yang, X., Xie, G., 2021b. Does internet development improve green total factor energy efficiency? Evidence from China. Energy Policy 153, 112247. https://doi.org/10.1016/j.enpol.2021.112247

[42] Wu, H., Wen, H., Li, G., Yin, Y., Zhang, S., 2024. Unlocking a greener future: The role of digital finance in enhancing green total factor energy efficiency. J. Environ. Manage. 364, 121456. https://doi.org/10.1016/j.jenvman.2024.121456

[43] Wu, J., Lin, K., Sun, J., 2023. Improving urban energy efficiency: What role does the digital economy play? J. Cleaner Prod. 418, 138104. https://doi.org/10.1016/j.jclepro.2023.138104

[44] Xue, Y., Tang, C., Wu, H., Liu, J., Hao, Y., 2022. The emerging driving force of energy consumption in China: Does digital economy development matter? Energy Policy 165, 112997. https://doi.org/10.1016/j.enpol.2022.112997

[45] Yeager, K.E., 2004. Electricity for the 21st century: Digital electricity for a digital economy. Technol. Soc., Technology and Science Entering the 21st Century 26, 209–221. https://doi.org/10.1016/j.techsoc.2004.01.031