Modelling the role of industrial structure adjustment on China's energy efficiency: Insights from technology innovation

Abstract

Due to uncoordinated economic progress, China's regional gap concerning energy efficiency (EE) is noticeable. However, industrial structure adjustments can be reorganized as a promising way to prioritize the green and low-carbon transition. Aiming to understand how regional EE can be achieved through industrial structure adjustment, this study empirically investigates the role of industrial structure adjustment in increasing interprovincial EE from a technology innovation perspective. Unlike previous studies, the primary analytical framework is anchored on a spatio-temporal domain. Specifically, we observe that industrial structure rationalization and industrial structure adjustment not only directly influence local EE but also indirectly exert a positive effect on EE improvements in adjacent provinces. The same implications are also valid when addressing the EE-ICT nexus. Further mechanism analysis shows that technology innovation positively moderates industrial structure adjustment to EE enhancements, with regional heterogeneity being all-important. We find that the non-linear effect of industrial structure adjustment on EE is conditioned by technology innovation. Increasing R&D input intensity could significantly change the impacts of industrial structure adjustments on EE efficiency.