Is there heterogeneity and moderating effect of carbon trading pilot in promoting total factor productivity?

Abstract

In order to analyze what factors may affect the role of carbon trading pilot in promoting total factor productivity, this paper constructs DID model combining information of listed companies with city and industry characteristics. The moderating effect model is used to research the influence of firms' induced behavior. The results show that (1) the characteristics of a city can influence the impact of carbon trading pilot, which is associated with the city's dominant industry, resource endowment, and geographical location; (2) the effect of carbon trading pilot is heterogeneous, primarily indicating a stronger effect on high-emission industries, while having no significant impact on high-pollution industries; and (3) the induced behavior of businesses, such as increasing green innovation and environmental protection expenditure, potentially "crowding out" the effects of the carbon trading pilot.