A Ride on the Wave of “Digital” and an Advance Towards “Green”: The Spatial and Temporal Impacts of the Integration of Digital and Green Finance on the Pollution and Carbon Reduction Performance in China

The synergistic convergence of digital and green finance (DGF) serves as a critical role for advancing ecological modernization in urban systems and carbon reduction performance (PCRP). Based on the symbiotic co-evolution of digital finance (DF) and green finance (GF), this study explored the developmental and evolutionary patterns, spatial effects, and influence mechanisms of DGF and PCRP in Chinese cities. The findings include the following: (1) Between 2011 and 2022, the levels of both DGF and PCRP increased and were generally higher in the eastern coastal cities than in the less developed western cities. (2) The spatial and temporal associations of DGF and PCRP showed a positive and intensifying relationship during this period, with most cities showing a positive correlation. (3) Spatial correlation was clearly positive, characterized by a clear trend of expansion and concentration of High-high aggregates and an overall banded distribution of all types of aggregates. The High-high clusters were mainly concentrated in the eastern cities and inland major cities; notably, the Low-low clusters were mostly distributed around the High-high clusters, with a relatively stable distribution. (4) In terms of spatial spillover effects, DGF not only contributed directly to PCRP but also indirectly advanced it through improving ESG performance, promoting green technology innovation and increasing public concern for the environment. In addition, the effect of DGF on PCRP was more pronounced in the eastern parts and non-resource cities. This study provides theoretical and empirical support for deepening DGF to promote PCRP at the city level.