Green Finance, Environmental Regulation, and Green Technology Innovation Based on the Threshold Effect

To address global climate challenges, China’s transition toward a green, low-carbon economy underscores the critical role of green finance (GF) as a key policy instrument. Against this backdrop, clarifying how GF influences green technology innovation (GTI) has become an urgent research priority. Using panel data from 283 Chinese cities (2012–2023), this study estimates a panel threshold model to examine the non-linear relationship between GF and GTI, with environmental regulation (ER) as the threshold variable. The results, validated by robustness and endogeneity tests, reveal the following: (1) GF exerts a double-threshold effect on GTI, with its promoting effect strengthening between thresholds but weakening beyond the second threshold. (2) ER exhibits a significant single-threshold effect; beyond it, GF’s contribution to GTI is substantially enhanced. (3) Three types of heterogeneity analysis are performed based on geographical regions, historical endowments, and whether a city is classified as an innovation-driven city. Overall, the results indicate that the threshold effects are more pronounced in eastern regions, cities with stronger historical endowments, and innovation-driven cities. These findings not only deepen the theoretical understanding of the GF–ER–GTI nexus but also provide empirically grounded insights for designing differentiated GF policies and region-specific environmental regulation strategies, thereby supporting both China’s low-carbon transition and global climate governance efforts.