How does the digitalization of global value chains affect China’s carbon welfare performance?

Enhancing carbon welfare performance (WPCE) is an important driving force to promote economic and social development in the direction of green and low-carbon. Based on the panel data of 30 provinces in China from 2007 to 2020, the article systematically examines the effects and mechanisms of Global Value Chain (GVC) digitization on China’s WPCE. The study finds that the digitalization of GVCs significantly contributes to the improvement of WPCE, and the mechanism analysis shows that the digitalization of GVCs contributes to the improvement of China’s WPCE through the fourfold pathways of optimizing industrial structure, promoting technological innovation, accumulating human capital, and mitigating resource misallocation. Heterogeneity analysis shows that the effect of GVC digitization on China’s WPCE is more prominent in the southern region, the Yangtze River Economic Belt (YREB), and regions with better economic development. The findings of the study provide policy references and a theoretical basis for how China can move towards green and low-carbon transformation and realize high-quality development.