Does the coordinated development of two-way FDI increase the green energy efficiency of Chinese cities? Evidence from Chinese listed companies.

Based on the evidence from listed company microdata and data from 285 cities in China, this paper studies the coordinated development of two-way FDI (CDFDI) in improving green energy efficiency (GEE). In particular, this paper examines the spatial heterogeneity effects of CDFDI on GEE. The results showed that CDFDI had a positive impact on the GEE of local and surrounding cities. Mechanistic examinations show that the effects of CDFDI on GEE are mediated by technological diffusion, nationalization, and environmental regulation. After dividing different city types, the impact of CDFDI is also different. By constructing a spatial decay weight matrix, this paper also finds that the positive spatial spillover effect of CDFDI is limited to 1050 KM. Finally, different investment motive portfolios also has a heterogeneous impact on the local and surrounding cities' GEE. After dividing the time nodes, the effect of this heterogeneity is more prominent. • We use multiple undesired output indicators covering eight pollutants to measure green energy efficiency (GEE). • CDFDI has a significant boost to GEE in local and surrounding cities. • The impact of CDFDI on GEE is moderated by technological diffusion, nationalization, and environmental regulation. • The spatial spillover effects of CDFDI are heterogeneous by city category and geographic distance. • CDFDI with different investment motives has heterogeneous effects on local and surrounding cities' GEE. [ABSTRACT FROM AUTHOR]