How does urban innovation affect haze pollution? Evidence from 270 cities in China

Urban innovation is not only an important part of achieving high-quality urban development but also an important aspect of the national innovation-based development strategy. The results obtained from using data on the ground-level experience of cities from 2001 to 2016 in the empirical test show that raising the level of urban innovation can reduce haze pollution. Our results are robust to multiple scenarios, such as considering endogeneity problems and controlling interference from external policies. The heterogeneity analysis shows that the innovative haze reduction effect of medium-size, northern towns, and cities with high human capital, high economic development, and an increased infrastructure level is most significant. The transmission mechanism shows that the technological upgrading effect, structural optimization effect, and resource agglomeration effect caused by raising the urban innovation level are important channels for reducing haze pollution. Our expanded analysis indicates that urban innovation has a threshold effect on haze pollution, and the haze reduction effect is only generated after the threshold value is reached. The technology-driven and compact urban development model can strengthen the haze reduction effect of innovation. In contrast, the institutional innovation and sprawling urban development model inhibit the haze reduction effect of innovation.