The Impact of Agglomeration of Producer Services on Pollution Emission: Empirical Analysis Based on 260 Cities in China

Abstract

Since the 1980s, industrialization and urbanization have driven China’s rapid economic growth, but this growth has also exacerbated the deterioration of the ecological environment. Under the background of the current prominent structural problems and the "dual carbon" goal, it is particularly important to realize the development layout of green economy. As one of the important economic development models, the agglomeration of producer services can not only promote the improvement of economic efficiency, but also promote the upgrading of industrial structure, thereby realizing the coordinated development of environment and efficiency. Based on the panel data of 260 prefecture-level cities in China from 2007 to 2018, this paper constructs a Spatial Durbin Model to empirically analyze the effect and impact mechanism of producer service agglomeration on pollution emissions. The study found that China's urban pollution emissions have a significant positive spatial correlation, and the increase of pollution emissions from surrounding cities will increase the city’s pollution situation. In addition, on the whole, the increase in the degree of agglomeration of producer services significantly reduces pollution emissions, and there is a spatial spillover effect. Finally, the mechanism test shows that knowledge spillover and industrial structure upgrading are important channels for the agglomeration of producer services to reduce urban pollution emissions.