China’s Low-Carbon Cities Pilot Promotes Sustainable Carbon Emission Reduction: Evidence from Quasi-Natural Experiments

Abstract

Cities are critical agents to promote carbon emission reduction, and are also a key part of China achieving carbon peaking by 2030 and carbon neutrality by 2060. This study used a time-varying difference-in-difference (DID) method to provide quasi-natural experimental evidence based on the data of 284 prefecture-level cities in China. We robustly found that the low-carbon city pilot (LCCP) policy has a significant effect on carbon emissions’ reduction. The carbon emissions of pilot cities were reduced by about 1.63 percentage points compared to non-pilot cities. In addition, this study generates several intriguing findings: (1) The carbon emission reduction effect of the LCCP is more significant for cities in the eastern areas and cities with high economic development. (2) The LCCP policy is sustainable and has a lagging effect. The carbon emissions of pilot areas with one lag period and two lag periods were reduced by 1.76% and 1.90%, respectively, which means that the LCCP led to greater carbon reductions over time. (3) We prove the existence of the mediating effect of electricity consumption. The LCCP policy reduced carbon emissions by 3.72% by affecting per capita electricity consumption. (4) Cities in a state of negative decoupling between carbon emissions and economic growth gradually transformed into a state of enhanced decoupling, which shows that the carbon emissions of low-carbon pilot cities were effectively controlled with the economic growth. The conclusion of this study evaluates the current achievements of the LCCP policy and provides an empirical reference for the further formulation of environmental policies.