Abstract
AbstractCircular economy (CE) theory emphasizes that following the reduction, reuse, and recycling (3R) principles can promote the practice of the CE; at the same time, innovative technologies support the feasibility of these principles. However, in academia, it remains unknown whether innovative technologies can be used to effectively implement CE theory. This study estimates the CE performance of 280 cities in China using the super‐efficiency SBM–data envelopment analysis (DEA) model and analyzes the relationship between urban innovation capability (UIC) and the CE using a two‐way fixed‐effects model. The research findings are as follows: First, UIC enhances the CE performance. Second, unlike in green finance, when inclusive finance reaches a certain threshold, the promoting effect of UIC becomes stronger. Third, UIC has both a positive direct effect (local cities) and an indirect effect (neighboring cities). Mechanism tests on improving people's livelihoods, strengthening clean energy development, optimizing industrial structure, and improving agricultural productivity can explain these two effects. Finally, compared with general innovation, the impact of green innovation capability is greater, especially when it comes to green invention innovation. In addition, an innovation‐driven CE shows significant results in terms of carbon reduction and household income. This study theoretically and empirically confirms the driving force of innovation in the CE, providing favorable policy suggestions for countries facing economic transformation, such as China.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.