Abstract
Green finance plays a pivotal role in guiding and incentivizing private capital to invest in low-carbon industries and initiatives. This study utilizes data of Chinese cities from 2006 to 2022 to investigate the influence of green finance on carbon emission efficiency. The results show that green finance significantly contributes to enhancing carbon emission efficiency. The impact of green finance on carbon emission efficiency is subject to a dual threshold effect, which depends on the level of regional economic development. Regional innovation emerges as a vital channel through which green finance influences carbon emission efficacy. Moreover, the sensitivity of carbon emission efficiency to the green finance index shows an inverted U-shaped trend. Green support is most significant in green finance sub-dimensions. These findings provide valuable theoretical support for the role of green finance in fostering carbon efficiency improvement and provide essential insights for formulating effective policy strategies.