Fiscal sustainability is an issue of great concern for governments globally and air pollution control has become an important factor affecting fiscal sustainability. This study aims to examine the impact of air pollution on fiscal sustainability in the short and long run. We conducted an empirical analysis based on air pollution and local government debt data on China’s prefecture-level cities in 2014–2019, using regression discontinuity design (RDD) and a panel data model. The results show that air pollution reduces the debt burden of governments in the short run. However, in the long run, addressing the negative impacts of air pollution adds to the debt burden of local governments, hindering fiscal sustainability. Fiscal freedom and the level of public services significantly moderate the negative impact of air pollution on fiscal sustainability. A higher level of fiscal freedom generally indicates a greater incentive for local governments to raise pollutant emission standards, strengthen the construction of green infrastructure, and subsidize green enterprises. Furthermore, a higher level of public services reflects better infrastructure and higher levels of investment in environmental protection, which help to reduce the negative impact of air pollution. The governments are suggested to take measures to effectively control air pollution, so as to enhance fiscal stability in the long run.

This paper examines the effect of local government debt (LGD) and real estate investment on corporate investment. It finds that the increase in LGD and real estate investment leads to a decline in corporate investment and that the crowding-out effect is mitigated by the interaction of LGD and real estate investment. The effects are channeled by raising corporate costs and reducing corporate financing. This impact is more pronounced for firms in eastern regions and nonresource-based cities, large and private firms.

With technology and finance becoming increasingly integrated, it is imperative to use fintech to improve the capability to forestall and defuse major financial risks. As an area prone to financial risks, the real estate industry deserves in-depth research on the dynamics between risks and technological capability (TC). In this paper, a simulation model was constructed with system dynamics to examine whether an improvement in TC can effectively improve risk management capability (RMC), and to explore the specific interaction between RMC and TC under six policy scenarios. We present the following findings: (1) TC has a significant supporting role in risk management; (2) increasing R&D financial input is more effective than increasing personnel input when it comes to improving TC; (3) whether it is a single input or multiple inputs of different types, increasing R&D financial input is also more effective than increasing personnel input when it comes to improving risk management; (4) overall, improvements in TC and RMC have a positive effect on social and economic development. This study not only makes clear the interconnection between TC and RMC and enriches the research content in this field, but also provide a reference for preventing and resolving major financial risks and promoting stable social and economic development.