Role of green finance in resource efficiency and green economic growth

The issue of resource efficiency and achieving green economic growth has become a controversial issue in recent years. This research has studied the green financing tool as a reliable and effective solution to achieve green economic growth and increase resource efficiency. Using the method of Panel Vector Autoregressive (PVAR), the relationships between green bonds, resource efficiency index, and green economic growth rates in the industrial and agricultural sectors in 29 countries with green financing markets during 2015–2021 were analyzed. The major results confirmed that issuing green bonds and green economic growth in the industry could accelerate agriculture's green economic growth rate. At the same time, resource efficiency has not significantly impacted the green economic growth rate in the agriculture sector. In addition, the feedback hypothesis exists in the relationship between issued green bonds and green economic growth in industry and agriculture. The main recommended policy implications are strengthening and reforming the financial sector, redefining resource efficiency indicators in countries, and developing of digital green financing market. •Green growth in agriculture positively determines the green bonds.•Green bonds accelerate the green economic growth rate.•The feedback hypothesis exists in relationship between issued green bonds, and green economic growth in industry and agriculture.