Collaborative governance on industrial pollution and carbon emissions through synchronous development of factor markets: Impact and mechanism

Abstract

Industrial sectors are pivotal areas for achieving the collaborative goal of pollution and carbon abatement, with technology playing a crucial role. Despite previous studies discussing the adverse environmental impacts of factor market distortion, there remains a research gap in examining the role of the technology market and the coordination among factor markets. This study introduces the concept of synchronous development between the capital and technology markets, drawing on the method of marriage-education matching in sociology. Furthermore, it employs the theoretical framework of new structural economics to investigate the impact and mechanisms of synchronous development between the capital and technology markets on the synergistic reduction of industrial pollution and carbon emissions, based on Chinese provincial-level panel data from 2000 to 2019 and auxiliary listed-company panel data. The results indicate that (1) the synchronous development between capital and technology markets facilitates collaborative governance in pollution mitigation and carbon abatement. (2) Industrial and technological structures serve as channel mechanisms, with the latter including technological innovation and productivity improvement of micro-enterprises as well as the optimization of energy consumption structure at the macro level. (3) Technology and labor quality endowments enhance the synergistic abatement effect, albeit by setting certain thresholds for actualization. (4) There is a reciprocal reinforcement and restrictive relationship between the synchronization and development of factor markets. This study applies the new structural economic theory to collaborative governance on pollution and carbon emissions, extending the research on the environmental and climate impacts of factor markets.