Moving towards sustainable city: Can China's green finance policy lead to sustainable development of cities?

In pursuit of actively advancing energy transformation, ensuring the attainment of carbon peak and carbon neutrality objectives, and fostering sustainable development, China has dedicated substantial efforts. This article treats the Green Finance Reform and Innovation Pilot Zones (GFPZ) as a quasi-natural experiment, thereby constructing an analytical framework for evaluating the impact of green finance on achieving Sustainable Development Goals (SDGs). We empirically investigate this impact by analyzing data from 316 cities in China spanning the period from 2011 to 2020, employing a difference-in-differences (DID) model. The study suggests a gradual improvement in the level of sustainable development in China. Moreover, green finance contributes to SDGs, and the conclusion is robust. Further investigation reveals that green finance improves sustainable development by fostering technological innovation. Heterogeneity results indicate that the influence is notably more pronounced in western regions and locales characterized by stringent environmental regulations. This article offers fresh perspectives on achieving SDGs.