The impact and nonlinear relationship of low-carbon city construction on air quality: Evidence from a quasi-natural experiment in China

Many low-carbon policies have been implemented to realize China's “double carbon goals”. Maximizing the synergistic effects of pollution reduction is very important. This study develops difference-in-difference and panel threshold models to analyze the effects of the low carbon city pilot (LCCP) policy on air quality and the nonlinear relationship between them. The results show that: (1) As a whole, the LCCP policy can effectively improve air quality in pilot cities. When regional heterogeneity is concerned, the policy shows a pollution mitigation effect in the eastern and central regions, while it shows a green paradox effect in the western region. (2) The LCCP policy has a spatial spillover effect and displays a U-shaped relationship in terms of distance in a full sample context. The spatial spillover effects of the LCCP policy in terms of the distance vary across regions. (3) There is a nonlinear relationship between LCCP policy and air quality based on the level of economic development and city innovation. When a city's economic development and innovation levels are relatively weak, the policy effect is reflected as a green paradox effect. The LCCP policy can significantly improve the air quality in the pilot cities only when the economic development level and city innovation level exceed a certain threshold. That means different cities should make their low-carbon development plans due to their development level.