How does urbanization affect carbon emission efficiency? Evidence from China

The complex impact of urbanization and the enormous pressure to reduce carbon emissions are two major challenges facing China. However, few studies have considered how urbanization affects carbon emission efficiency. To explore the impact of urbanization on carbon emission efficiency, this study evaluates the carbon emission efficiency based on the panel data of 30 provinces in China from 2000 to 2016. The correlations between six factors, including the level of urbanization, and carbon efficiency were analyzed by using a stochastic frontier model that combines with the translog production function. The results suggest that, first, despite the steady improvement in China’s carbon efficiency, the average carbon efficiency is 0.5730 in 2016, with room for improvement of 42.70%. Second, there is an inverted U-shaped relationship between urbanization and carbon emission efficiency. The coefficient of the urbanization level is −0.6370, and the coefficient of its square is 1.2310. In the early stage, the expansion of the scope of urbanization promotes the improvement of carbon emission efficiency. Once the urbanization level passes the critical point, the economic growth rate will lag behind the growth rate of carbon emissions. Third, economic development level, energy consumption structure, foreign trade, and government intervention are positively correlated with carbon emission efficiency. Industrial structure inhibits the improvement of carbon emission efficiency. The conclusion provides a theoretical reference for urban planning and the green economy for government policymakers.