Study On The Impact Of Financial Development And Technological Innovation On Environmental Pollution

In order to improve people’s living standards rapidly,China’s economic has been rooming with the crude mode of development since the reform and opening up.While,the crude mode of development has made greatly damage on the ecological and natural environment.In recent years,there has been increasing pollution in most areas of northern China,such as the haze disaster,heavy metallization of water resources,soil pollution and so on,which seriously threatens people’s physical and mental health.The public have paid more attention to the coordination of economy and ecological environment,which requires us to improve the environmental quality and ensure the economic growth at the same time.As an indispensable part of the economy,the development of finance plays an important role in transforming the mode of economic development and promoting environmental protection.Simultaneously,as the primary productive force,science and technology must take technological innovation as the priority and devote itself to improving the efficiency of resource utilization,which is the fundamental way to reverse the current crisis of resources and environment.Therefore,it is of great value to explore the internal mechanism of financial development and technological innovation on environmental pollution.Before exploring the mechanism,we list the following questions: First,what is the internal relationship between financial development,technological innovation and environmental pollution?Second,is there a significant correlation between financial development,technological innovation and environmental pollution? Third,is there long-term equilibrium between financial development,technological innovation and environmental pollution? Above all,based on the synthetic analysis of theoretical framework and empirical research,this paper discovers the internal relationship among financial development,technological innovation and environmental pollution in China,and strives to make a more precise description and explanation.Based on the theory of IPAT and STIRPAT models,the internal mechanism between financial development,technological innovation and environmental pollution is studied by the game analysis.What’s more,the provincial panel data from 2005 to 2017 is selected to construct the parameter panel,smooth transition model and spatial panel method to analyze environmental pollution factors from the angle of the direct,indirect and spatial spillover effect.During the process of theoretical and empirical analysis,regional differences in environmental pollution are illustrated by differences in the level of financial development and technological innovation.Furthermore,the change rules and possible strategic choices are explored to provide some references for the policy formulation of sustainable economic and social development.The basic conclusions of this paper include:Firstly,enterprises are the main environmental polluters,and the important parties to prevent and control environmental pollution.Through active technological innovation activities,including innovation in multiple fields like production system,energy system and emission reduction system,enterprises can improve their production efficiency and enhance the market competitiveness of their own.In the meanwhile,the active technological innovation activities contribute to the reduction of pollutant emissions at the source by decrease the cost of pollution emission per unit of output,thus reducing the ecological environment pollution caused by enterprise production to some extent.Secondly,under social supervision,the impact of financial development on the environment depends on the investment preference of financial enterprises.When financial investment focuses on profit maximization,financial development will lead to the occurrence of enterprise speculation and increase the pollutant emission of enterprises.When financial investment is more inclined to environmental protection enterprises,financial development is conducive to encouraging enterprises to choose environmental protection strategies,thus conducive to the prevention and control of environmental pollution.Thirdly,the impact of financial development on environmental pressure is interfered by the level of regional technological innovation,which shows non-linear characteristics.With the improvement of regional technological innovation level,the impact of financial development on environmental pressure in this region increased at first and then reduced.Spatial spillover exists in the effect of financial development has on environmental pollution,and the improvement of local financial development level is conducive to the reduction of environmental pressure in surrounding areas.Fourthly,there is also a non-linear relationship between technological innovation and local environmental pollution.In regions with lower level of technological innovation,technological innovation has a significant restraining effect on environmental pollution.However,with the improvement of technological innovation,the restraining effect decreased.In addition,the improvement of local technological innovation level can reduce environmental pressure in surrounding areas.Lastly,China’s environmental pollution has a significant spatial dependency,namely,high(low)pollution areas are often adjacent to high(low)pollution areas.In regions with a low level of technological innovation,there is a significant inverted ushaped relationship between economic growth and environmental pollution.With the improvement of the level of economic development,environmental pressure tends to rise first and then fall.The innovation of this paper is mainly embodied in the following aspects:(1)Based on the game theory,this paper studies the relationship between financial development,technological innovation and enterprse emission reduction behavior from the perspective of maximizing enterprise profits and social welfare.The behavior strategies of enterprises and enterprises,as well as enterprises and social groups are illustrated to explore the impact mechanism of financial development and technological innovation on environmental pollution.In addition,simulation is utilized to improve the ability of explanation and analysis of game model.(2)Instead of relying solely on the panel threshold model to capture the non-linear relationship of variables,a smooth transition panel model is constructed to study the nonlinear impact of financial development and technological innovation on environmental pollution.Different from the previous studies that regard economic growth as a variable of transformation,this paper starts from the transfer effect of financial development and technological innovation on environmental pollution,and takes financial development and technological innovation as the variable of transformation to analyze their indirect impact on environmental pollution.(3)This paper constructs a spatial panel model to analyze the impact of financial development and technological innovation on environmental pollution.It not only discusses the spatial agglomeration of environmental pollution in China as a whole,but also analyses the impact of local financial development and technological innovation capability on the surrounding areas.