To be an eco- and tech-friendly society: Impact research of green finance on AI innovation

Green finance can effectively support industrial upgrading and technology development, such as artificial intelligence (AI). In this paper, we attempt to pursue the possibility of a win-win situation for achieving an eco- and tech-friendly society. By asking where and how we could develop green finance and AI innovation simultaneously, this paper conducts an empirical investigation on the influence of green finance on the development of AI in China from 2011 to 2020. Based on the panel data from the 30 provinces, we introduce spatial measurement, policy effect, heterogeneity, and threshold analyses to present deeper insights into the impact of green finance on AI innovations. Indeed, green finance could promote the progress of AI innovation. China’s green finance pilot policy is verified to promote the progress of local AI innovations. Furthermore, the spatial spillover effect and regional heterogeneity are observed as well. The promotion effect is most significant in the western area, where the green finance index is relatively low. Besides, the threshold analysis also considers how to increase the marginal effect of green finance in different areas. Finally, several policy recommendations are proposed, which contribute to providing specific directions for the policymakers to improve AI innovation and achieve sustainable development at the same time.