Unleashing the nexus among export sophistication, digital development, and ecological efficiency: evidence from China

As the critical work of future economic reform in China, the "dual carbon goal" would significantly impact China's participation in international trade and commodity structure in the future and it will bring considerable challenges to the import and export industries and foreign trade enterprises. This study applies the generalized method of moments (GMM) to empirically assess the effects of export sophistication and digital development on ecological efficiency using 2006-2016 panel data from 30 provinces in China. The empirical findings reveal that there has been a yearly increase in the provincial green total factor productivity (GTFP), which is mainly driven by the promotion of technological level and has a significant regional heterogeneity. Both export sophistication and digital development have a positive impact on promoting ecological efficiency. In general, one unit increase of export sophistication would lead to an increase in GTFP by approximately 0.02-0.03. However, digital development has a negative moderating effect on the influence of sophistication on green total factor productivity, which indicates that the positive impact of export sophistication demonstrates a tendency for the marginal effect to diminish when digital development is sufficient. The reason is that digital development strongly impacts the regional economic pattern in China, and economically developed coastal areas often have a higher level of digital construction and export structure. After clustering, it indicates that while digital development has a stronger favorable influence on increasing GTFP in the western area, export sophistication has a substantial positive impact on GTFP in the eastern region.