How does air pollution affect urban innovation capability? Evidence from 281 cities in China

Technological innovation may help to reduce air pollution, but existing relevant studies have not clarified whether and how air pollution affects urban innovation capability. Therefore, based on the fixed-effect model, we examine a panel of 281 prefecture-level cities in China from 2003 to 2015, and find that air pollution significantly inhibits the improvement of urban innovation capability on the whole in China. Meanwhile, affected by the “human resource loss effect”, air pollution in cities of large scale or eastern China has a significantly greater inhibitory effect on innovation capabilities. Besides, affected by the “resource crowding out effect”, the negative impact of air pollution on urban innovation capability in key environmental protection cities is far greater than that in non-key cities.