The spatial threshold effect and its regional boundary of financial agglomeration on green development: A case study in China

Financial agglomeration is a key approach to the green transition of China's economy and society. However, few studies have examined the spatial threshold effect on the regional boundary of financial agglomeration. In this paper, the mechanism of the spatial threshold effect is analyzed with spatial panel Durbin model and panel threshold regression (SPDM_PTR) model over 272 prefectural-level cities in China from 2003 to 2014. The results show: (1) Financial agglomeration plays an important role in promoting local green development. (2) The spatial spillover effect progresses in stages. When the agglomeration level exceeds 1.949, the spatial spillover effect of high-level financial agglomeration is significantly stronger as opposed to medium- and low-levels. (3) The regional boundary of the spillover effect changes with the financial agglomeration level, with 1480 Km for high-level, 860 Km for medium-level and 700 Km for low-level financial agglomeration. These findings suggest concrete evidence for developing policies for further encouraging green development of regional financial agglomerations. (C) 2019 Published by Elsevier Ltd.