China's green economy transition: renewable energy development, rural transformation, and sustainable economic growth

This study investigates China's ongoing green economy transition by examining how renewable energy investment (REI), green policy intensity (GPI), and rural electrification jointly drive improvements in green total factor productivity (Green TFP), carbon emission reduction, and sustainable economic growth across 30 Chinese provinces over the period 2000 to 2023. Employing a Spatial Durbin Model (SDM), dynamic panel generalized method of moments (GMM) estimators, pooled mean group (PMG) cointegration, and a double-threshold panel regression framework, the analysis yields four principal findings. First, REI exerts a significant positive effect on Green TFP with a direct elasticity of 0.248 and an indirect spatial spillover elasticity of 0.143, confirming the presence of cross-provincial technology diffusion. Second, rural electrification acts as a critical mediating pathway, accounting for 28.4% of REI's total effect on sustainable GDP growth by bridging energy access improvements with agricultural modernization and rural income convergence. Third, the relationship between GPI and REI effectiveness exhibits a double-threshold nonlinearity: the marginal impact of REI on Green TFP is significantly stronger once GPI crosses an upper threshold of 1.80, suggesting that policy complementarity amplifies investment returns. Fourth, sigma convergence analysis reveals that provinces with higher green transition intensity exhibit faster cross-provincial income convergence, with the standard deviation of log per-capita income declining at 3.8% per annum compared to 1.8% for low-transition provinces. The findings carry important implications for policy sequencing, spatial coordination mechanisms, and the design of rural-inclusive green development pathways in China and analogous developing economies.