Does digital infrastructure cut carbon emissions in Chinese cities?

Abstract

China has made remarkable progress in the construction of its digital infrastructure in recent years. The role of digital infrastructure in the reduction of emissions has become increasingly prominent. This study attempted to assess the impact of digital infrastructure on carbon emissions and identify its mechanism based on panel data for 215 Chinese cities from 2011 to 2019. The empirical results indicate that digital infrastructure has significantly increased total carbon emissions, per capita carbon emissions, and carbon intensity in Chinese cities, with marginal effects of 1.818, 0.0515, and 0.995, respectively. The conclusions still hold after a series of robustness tests such as introducing instrumental variable estimation and the exogenous policy shock of Broadband China. The mechanism analysis indicates that digital infrastructure could inhibit urban carbon mitigation and energy conservation by inducing per capita energy consumption, total energy inputs, marginal diminishing factor productivity gains, and increasingly energy intensity. The carbon emission trading scheme can effectively mitigate the effect of digital infrastructure in Chinese cities, while the energy-consuming right trading system does not mitigate the environmental externalities of digital infrastructure. This study may help policymakers better understand the effect of digital infrastructure on the environment, and it presents policy implications related to the accelerating construction of digital infrastructure in China.