Recently, Lin Liguo, Professor at the School of Economics and Chief Expert of the Chinese Modernization Research Institute, Shanghai University of Finance and Economics, published the article How Green Consumption Becomes a New Growth Driver for Expanding Domestic Demand on the theoretical page of Guangming Daily. From the dimensions of demand structure upgrading, sound supply-demand cycles and multi-stakeholder coordination, the article analyzes the strategic functions and institutional pathways of green consumption, and reveals its far-reaching significance for stimulating the growth momentum of domestic demand and advancing the comprehensive green transition of the economy and society.
Article Overview
The Outline of the 15th Five-Year Plan explicitly identifies the development of green consumption as an important instrument for expanding domestic demand. Guided by resource conservation, environmental friendliness, health and moderation, green consumption relies on green products, green services, green scenarios and recycling systems. It covers physical consumption such as new energy vehicles, energy-saving home appliances and green food; service consumption including green travel, green tourism and green catering; as well as circular consumption such as second-hand trading, maintenance and leasing, and remanufacturing. Running through the full cycle of purchase, use, maintenance, recycling and reuse, green consumption meets people’s real demand for high-quality, low-carbon lifestyles. Meanwhile, it connects green manufacturing, green circulation and the circular economy system, serving as a vital carrier that organically unites the improvement of residents’ well-being, the expansion of green supply and the cultivation of driving forces for domestic demand growth.
The profound value of green consumption for expanding domestic demand lies in activating the virtuous cycle of “demand driving supply and supply creating demand”. It directly unleashes green purchasing power, and at the same time pushes enterprises to upgrade technologies and raise total factor productivity through large-scale demand, turning the ultra-large domestic market into a field for green technology iteration and the fostering of new-quality productive forces.
Whether green preferences can be translated into actual purchasing decisions is the key to determining whether green consumption can become a new growth driver of domestic demand. This hinges on factors including affordability, information accessibility, relative prices and convenience of use. The fundamental approach is to improve the cost-benefit structure through institutional arrangements, lower the green premium, information costs and disposal costs (such as trade-in schemes, energy efficiency labels and recycling networks), so that green products and services become “available, affordable, trustworthy, user-friendly and recyclable”.
China continues to expand green consumption scenarios covering services, circulation and county and rural markets, leaving huge room for growth. Nevertheless, multiple bottlenecks remain: high upfront costs of green products, insufficient supporting infrastructure, ambiguous certification labels, non-standard market pricing, and an incomplete statistical and monitoring system for green consumption, all of which constrain industrial development.
The solution lies in improving institutional supply. In the short run, trade-in policies should be optimized. In the medium run, carbon footprint accounting and mutual recognition of green certifications should be established. In the long run, green consumption will be integrated with the whole chain of manufacturing, finance and circulation. Meanwhile, the division of labor among multiple stakeholders should be clarified: governments set standards, enterprises cut costs, platforms optimize display, financial institutions innovate products, and consumers develop green habits. Only through multi-link coordination can green consumption shift from externally driven progress to endogenous growth.
