THE IMPACT OF DIGITAL INCLUSIVE FINANCE ON GREEN TOTAL FACTOR PRODUCTIVITY OF THE SERVICE INDUSTRY: NEW EVIDENCE FROM CHINA

The income of service industry has become a main segment in the Chinese GDP but some research evaluates its economic growth ignoring its environment effect. Digital inclusive finance (DIF) is turning out to be an advantage to the service industry in the context of Chinese e-commerce. This study took a novel perspective on Green Total Factor Productivity (GTFP) of the service industry in China and adopted Epsilon-Based Measure (EBM) DEA model to measure it. This study proposed a two-way fixed effects model to examine the impact of DIF on GTFP of the service industry and its impact mechanism. The results indicate that DIF has a significantly positive effect on the GTFP of the service industry, which remains robust after tests. Further, this paper finds that this effect is heterogeneous and green technology innovation and regional entrepreneurship activity are two transmission paths.