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This paper investigates the effects of innovation-driven development on carbon emissions reduction in Chinese urban area. We use panel data on 285 cities which covers 95.96% of Chinese cities during the period of 2003 to 2017. The time-varying difference-in-differences (DID) model is employed to estimate the impact of the creation of China’s National Independent Innovation Demonstration Zones (NIDZs) on urban carbon emission levels. Compared with non-pilot cities, our results indicate that total carbon dioxide emissions and emission intensity of pilot cities decreased by 4.8% and 5.8% respectively. The results suggest that the construction of NIDZs can significantly promote urban carbon emission reductions. Moreover, our mechanism tests indicate that this pilot policy can encourage technological innovation and optimize industrial structure, which in turn suppresses urban carbon dioxide emissions. Furthermore, heterogeneity analysis shows that the policy effect is stronger in cities with higher levels of human capital, government finance and information infrastructure. Overall, this study enriches the relevant research on carbon emission reduction of cities and puts forward some policy recommendations.

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Levying a water resources tax policy which called ‘fee to tax’ is a regulation formulated by China to restrain and alleviate water poverty. To test the effect of the water resources ‘fee to tax’, this research employ a multistage dynamic difference-in-differences (DID) model to explore whether the implementation of the policy can help alleviate water poverty based on panel data from 2009 to 2019. The results indicate the water poverty in western China is significant serious than in other regions and the implementation of the water resources tax policy significant alleviate water poverty (the sigh of the policy is positive and significant at the 1% level) in China. Additionally, the mechanism effects suggest that the policy can effectively restrain water poverty by reducing groundwater exploitation and optimizing the water utilization structure. In terms of spatial heterogeneity, the effect of water resources tax policy on alleviating water poverty is stronger in central and eastern regions than in western regions. The conclusions of this study may, to some degree, serve as a basis to scientifically guide the implementation of China's water resources ‘fee to tax’ policy and, thus, effectively improve the level of water resources management.

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