Does industrial agglomeration promote the increase of energy efficiency in China?

Abstract

Whether industrial agglomeration can promote an increase in energy efficiency is of great importance to not only China’s energy conservation and emissions reduction plans, but also China’s future sustainable development. This paper uses statistical data from 285 cities, from 2004 to 2013, to analyze the effect of industrial agglomeration on energy efficiency. The spatial autocorrelation tests show that there is significant spatial autocorrelation and spatial heterogeneity in urban energy efficiency. Although dynamic spatial econometric results show that industrial agglomeration can promote an increase in energy efficiency from a country level, there are significant differences at a regional level. In the east, the effect of industrial agglomeration on energy efficiency has a threshold effect, but in central and western areas, industrial agglomeration can promote the increase of energy efficiency, with the positive effect in western areas greater than that in central areas. Finally, based on the research, this paper puts forward concrete suggestions to enhance energy efficiency.