Does innovative city pilot policy improve carbon reduction? Quasi-experimental evidence from China

Abstract

A new direction for China in exploring sustainable development is the Innovative City Pilot Policy (ICPP), which provides policy guidance for accelerating carbon peaking and carbon neutrality by reducing carbon emissions. With data from 282 cities spanning 2006-2018, this paper examines ICPP's effect on carbon intensity (CI) through a progressive difference-in-difference (DID) model, as well as exploring the mediating, moderating, heterogeneity, and spillover effects. The results show that ICPP reduces CI significantly by enhancing technology innovation (TI), and when industrial structure (IS) is added, the effect of ICPP is expanded. The ICPP gains additional advantages in reducing CI by optimizing the efficiency of resource allocation (ERA). Compared with the concentration of human capital (HCL), the amount of scientific research institutes (SRI) has a slightly greater moderating effect. ICPP impacts considering location, size, and hierarchy heterogeneity. ICPP has a greater impact on mitigating CI in the western, larger size, and provincial capital cities. There are positive spillover effects of the ICPP on neighboring CI. To support the idea that ICPP can effectively contribute to CI reduction, this paper provides empirical evidence and theoretical guidelines.