The impact of manufacturing agglomeration on green development performance: Evidence from the Yangtze river economic belt in China

Abstract

Exploring pathways for China to achieve the dual goals of stabilizing economic growth and promoting green development provides important reference value for countries worldwide. This is particularly crucial in addressing global climate change and achieving carbon neutrality. This paper focuses on 108 cities within the Yangtze River Economic Belt in China, employing the Generalised Spatial Two-Stage Least Squares (GS2SLS) method to conduct an in-depth analysis of the impact of manufacturing agglomeration on green development performance. This study finds that, at the current stage, manufacturing agglomeration can effectively promote green development performance; however, the impact exhibits a U-shaped relationship. This means that the effect of manufacturing agglomeration on green development performance initially decreases and then increases. Additionally, knowledge spillover effects, resource allocation effects, and structural upgrading effects are important channels contributing to this nonlinear relationship. Extended analysis reveals that in the cities of the lower Yangtze River region, there is an inverted U-shaped relationship between manufacturing agglomeration and green development performance, while in the middle and upper reaches, the relationship is U-shaped. Furthermore, the expansion of city size positively promotes the green development effects of manufacturing agglomeration. These conclusions not only provide important guidance for China in achieving high-quality green development but also offer significant insights for developing countries worldwide in attaining the dual goals of economic growth and green development.