Does the setting of local government economic growth targets promote or hinder urban carbon emission performance? Evidence from China

Abstract

The management of growth targets drives China's rapid economic expansion and leads to potential carbon emission externalities. This paper empirically investigates the impact of economic growth target setting on carbon emission performance using panel data from 257 Chinese localities between 2004 and 2020. The analysis is conducted using 2SLS instrumental variable regression, cluster standard error regression, and the spatial Durbin model. The empirical findings indicate that local economic growth targets conditionally improve urban carbon emission performance, and moderate targets effectively enhance regional carbon emission performance, with moderate targets effectively enhancing regional carbon emission performance. However, aggressive economic growth targets do not contribute to the enhancement of regional carbon emission performance. The analysis of mechanisms shows that moderate economic growth targets enhance regional carbon performance by fostering innovation in green technology, while aggressive targets impede performance by encouraging increased investment in fixed assets and the growth of new cities. The analysis of heterogeneity indicates that cities in the eastern and western regions, characterized by larger populations and lower reliance on natural resources, have more effective economic development targets for enhancing local carbon performance. Additionally, the establishment of local economic development targets negatively affects the carbon emissions performance of neighboring regions, with the most significant negative spillovers observed at a spatial scale of 100 to 200 kilometers. This paper expands upon research concerning the environmental consequences of setting economic growth targets and the factors influencing carbon emission performance. It offers practical insights for achieving a balance between economic growth and carbon emission governance in emerging market countries.

The Impact of Local Government Environmental Target Constraints on the Performance of Heavy Pollution Industries

“…This, in turn, raises the financing constraints and operating costs for these companies. In response to these challenges and the need for survival, heavily polluting companies accelerate their efforts in technological advancement and green innovation, thereby improving their market competitiveness and mitigating the short-term negative effects of environmental target constraints on their performance [23]. However, it is important to note that the primary purpose of environmental target constraints and related regulations is to expedite the application of energy-saving and emission reduction technologies in heavily polluting companies, ultimately achieving green governance at the source.…”

“…[20] based on the "Porter Hypothesis", examined the connection between government environmental regulations and the innovation capabilities of listed companies and found that in regions with well-designed environmental policies, the innovation capabilities of companies in competitive industries were significantly improved. Under the environmental pressure of meeting environmental objectives, enterprises are stimulated to actively innovate, increasing investment in the development of clean tech-nologies and services [21], thereby achieving a competitive advantage and high-quality development [22,23]. Innovation activities triggered by government environmental regulations typically have a lagged positive impact on economic benefits.…”

“…In the short term they can choose to drastically reduce their emissions to ensure their own survival. How ever, for long-term sustainability and growth, they can opt to develop clean technologies upgrade their processes, and enhance resource utilization to address environmental gov ernance pressures [23,35,36]. Reasonable environmental constraints imposed by the gov ernment can stimulate companies to invest in research and development, leading them t prefer low-energy, low-pollution, green, clean technologies during their production pro cesses [36,37].…”

“…Ref. [23] based on the economic growth goals of 257 prefecture-level cities in China, found that moderate goals effectively improve carbon emission performance, but overly ambitious goals may backfire. However, ref.…”

Urban Intellectual Property Strategy and University Innovation: A Quasi-Natural Experiment Based on the Intellectual Property Model City of China

“…In order to obtain empirical data that meet the requirements of the empirical research in this paper, the raw data obtained through the aforementioned methods were processed as follows: Firstly, city samples that underwent administrative division adjustments during the period of 2007-2017 and had significant missing data on key variables were excluded (such as Hami City, Danzhou City, Linzhi City, Nachu City, Shannan City, etc.) [53]. Secondly, specialized colleges and universities were excluded from the sample, as well as undergraduate colleges and universities with significant missing data on key variables (such as Kashi University, Changsha Medical College, Haikou College of Economics, Yunnan Police College, Southwest University of Political Science and Law, and other colleges and universities).…”