Spatial spillover effects and action paths of electricity consumption driven by China's financial development based on global co-integration

Although studies on the influencing factors of electricity consumption are rich, the focus on the relationship between financial development and electricity consumption is scarce due to the characteristics of financial sector. In fact, the financial development cannot only increase electricity consumption, but also have the spatial spillover effects. Based on the global spatial modeling techniques, the long-term and short-term relationship between financial development and electricity consumption is examined, and the intermediary effect of financial development on electricity consumption through economic growth, urbanization, and industrial structure optimization is also verified. Results show that there is a global co-integration relationship between financial development, economic growth, urbanization, industrial structure optimization, and China's electricity consumption, rather than a local co-integration relationship. When the short-term change of electricity consumption deviates from the equilibrium state, the global error correction mechanism can promote the unbalanced system to return to equilibrium from time and spatial dimension. This study confirms not only the spatial spillover effects, but also heterogeneous influences of financial development on electricity consumption, which provides new evidence to make relevant policies.