Can the digital economy empower the transportation sector to improve green total factor productivity?

The digital economy has the potential to facilitate digitization and green transformation within the transportation sector, but further research is warranted on how it can enhance the sector’s green total factor productivity (GTFP). Utilizing provincial data from China spanning 2013 to 2021, this study investigates the impact of the digital economy on the transportation sector’s GTFP. The findings are as follows: (1) The transportation sector exhibits a U-shaped relationship between the digital economy and GTFP. The inflection point of the U-shaped curve is at 0.441, with 81.11% of the samples falling to the left of this point. It is primarily through technological progress and innovation, rather than changes in technological efficiency, that the digital economy influences the improvement of GTFP. (2) The U-shaped relationship exhibits heterogeneity and varies depending on the mode and content of transportation. The U-shaped relationship is more pronounced in regions with lower total traffic volume on highways and railways or higher traffic volume on waterways. For transportation content, DEEI and GTFP show a significant U-shaped relationship in areas with high traffic volumes of passengers and freights. (3) Government intervention can attenuate the U-shaped relationship, which leads to a flatter curve. The market-driven level has the capability to strengthen the U-shaped relationship, resulting in a steeper curve. In conclusion, these findings contribute to deeper insights into the U-shaped relationship between the digital economy and GTFP, offering valuable guidance for policymakers seeking to improve GTFP in the transportation sector.