Green total factor productivity (GTFP)

 GTFP is a modern productivity index that examines economic growth by

considering input, output, and undesired outputs, such as energy constraints,
carbon emissions, and environmental resources
 GTFP can potentially reflect the efficiency of energy development and use
accurately. It also aids in determining the economic growth that is conditional
on the energy consumption scale or energy use efficiency enhancement
 The world faces multiple environmental challenges, such as natural resource
degradation, climate change, global warming, pollution, etc. Almost every
country’s economic expansion has been accompanied by resource depletion,
environmental pollution, and ecological degradation
Green technology innovation and green
total factor productivity
 Green technology adheres to the law of ecological economics and prioritizes
resource and energy conservation during innovation. It reduces pollution and
environmental destruction during innovation and ensures that technological
innovation has the least ecologically negative impact possible.
 GTI fosters the development of manufacturing technologies and the creation
of new products, resulting in significant efficiency gains. From the standpoint
of the innovation system, improving GTFP through technological innovation is
to decrease outflow in energy consumption through system transformation
and then increase energy TFP overall.
Hypothesis
 Green technological innovation is a significant positive predictor of green
total factor productivity.
Financial development and green total
factor productivity
 The literature review indicates that financial development can help economic
progress by assembling investments, optimizing capital allocation, and
minimizing risk.
 Financial infrastructure may boost economic growth and influence energy
demand. A higher level of financial development results in the growth of the
financial market, economic development and an increase in investment capital.
 A better financial system is a source for improving eco-friendly industrial
technology, which leads to enhanced energy infrastructure and a reduction in
CO2 emissions
Hypothesis
 Financial development is a significant positive predictor of green total factor
productivity in China
Green finance and green total factor
productivity
 The focus of GTFP is on input and output, in the current phenomenon, green
finance serves as an input aiming to promote environment-friendly practices
and revival of natural climate output by minimizing CO2 emissions
 It is argued that green finance promotes energy efficiency by lowering
excessive energy consumption from the input side by minimizing reliance on
fossil fuels and excessive environmental harm from the output side.
Hypothesis
 Green finance is a significant positive predictor of green total factor
productivity in China