Towards net-zero emissions: Can green bond policy promote green innovation and green space?

In the context of the worsening global climate change crisis, recent studies have highlighted the topic of net-zero emissions. Green bond policy as an important course of action to promote the green energy market is also attracting growing attention. This research thus focuses on whether green bond policy stimulates green innovation and green space, thus helping to achieve net-zero emissions. Based on data of cities in China, an empirical study is carried out and offers the following findings. First, green bond policy does directly foster green innovation and green space, and the results of robust tests show that the basic conclusion is reliable. This effect is also heterogeneous. Second, green bond policy encourages green innovation in different types of cities, but only does so for green space in cities with middle-level and high-level economic size and openness. Third, green bond policy indirectly promotes green innovation and green space by driving economic growth and increasing disposable income. Moreover, this effect is spatial. Fourth, green bond policy upholds local green innovation and green space, but hinders them in surrounding cities. Considering the direct effect and spillover effect together, the total effect is significantly positive. Lastly, the subsequent high-quality implementation of green bond policy is the key to further fostering green innovation and green space.