Research on the Impact of OFDI on Green Total Factor Productivity: Evidence from 30 Provinces in China

Against the background of building a Beautiful China and pursuing high-quality economic development, it is crucial to give better play to the role of outward foreign direct investment (OFDI) in promoting green total factor productivity (GTFP). Based on panel data of 30 provinces in China from 2012 to 2022, this paper first measures provincial GTFP accurately using the super-efficiency SBM model and the global Malmquist-Luenberger index. Then, it employs the benchmark regression model and the mediation effect model to systematically examine the impact of OFDI on GTFP. The results show that: (1) OFDI has a significant positive effect on GTFP, and this conclusion remains robust after replacing core variables and excluding extreme sample years. (2) Environmental regulation plays a partial mediating role in the impact of OFDI on GTFP. That is, OFDI can indirectly improve GTFP by enhancing regional environmental regulation intensity. (3) Regional heterogeneity analysis indicates that the promotion effect is significant in western China and areas east of the Hu Huanyong Line, but insignificant in central, eastern and northeastern China, as well as areas west of the Hu Huanyong Line. This study provides empirical evidence for China’s foreign investment strategy to better serve green economic transformation.