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Place-Based Policy, Industrial Coagglomeration, and Urban Carbon Productivity: Evidence from the Establishment of China’s National New Zones (NNZs)

Author

Listed:
  • Yuge Zhang

    (School of Economics, Ocean University of China, Qingdao 266100, China)

  • Kaili Wang

    (School of Economics, Qingdao University, Qingdao 266100, China)

  • Fuzhu Li

    (School of Economics, Ocean University of China, Qingdao 266100, China)

  • Yuki Yi Gong

    (College of Computing, Georgia Institute of Technology, Atlanta, GA 30332, USA)

  • Sing Lui So

    (College of Computing, Georgia Institute of Technology, Atlanta, GA 30332, USA)

Abstract

Under the constraints of carbon peaking and carbon neutrality, in order to facilitate the realization of SDGs in China’s cities, place-based policy needs to strike a balance between “economic growth” and “carbon reduction”. This paper considers the establishment of NNZs as a quasi-natural experiment and constructs an asymptotic DID model based on the data of 283 Chinese cities in 2006~2021 to assess the causal effects of place-based policy on urban carbon productivity. It is found that the establishment of NNZs significantly enhances urban carbon productivity, and this conclusion still holds after considering the validity, endogeneity, and robustness of the model. Mechanism analysis shows that the policy preferences of tax incentive and improving transport and other infrastructural facilities, the policy supervision and the industrial coagglomeration are the positive moderating mechanisms of the establishment of NNZs to enhance urban carbon productivity, but in addition to the policy preference of financial subsidy. Moreover, under the moderating effect of industrial coagglomeration, the establishment of NNZs enhances urban carbon productivity through three mechanisms: deepening of the specialized division of labor, optimizing of industrial structure, and innovating synergistically. Heterogeneity analysis showed that the moderating effect of industrial coagglomeration on urban carbon productivity is heterogeneous depending on the spatial layout of NNZs, in terms of planning area, the effective range is 1000~2000 km 2 and the optimal range is 1500~2000 km 2 , and as far as the layout pattern is concerned, the optimal pattern is the dual-city layout. The conclusions provide a realistic basis and direction of thinking for optimizing the policy design of NNZs and promoting the green transformation of place-based policy.

Suggested Citation

  • Yuge Zhang & Kaili Wang & Fuzhu Li & Yuki Yi Gong & Sing Lui So, 2025. "Place-Based Policy, Industrial Coagglomeration, and Urban Carbon Productivity: Evidence from the Establishment of China’s National New Zones (NNZs)," Sustainability, MDPI, vol. 17(7), pages 1-22, March.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:7:p:3085-:d:1624796
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    References listed on IDEAS

    as
    1. Zhang, Xiaoqian & Yao, Shujie & Zheng, Weiwei & Fang, Jing, 2023. "On industrial agglomeration and industrial carbon productivity --- impact mechanism and nonlinear relationship," Energy, Elsevier, vol. 283(C).
    2. Du, Jun & Mickiewicz, Tomasz, 2016. "Subsidies, rent seeking and performance: Being young, small or private in China," Journal of Business Venturing, Elsevier, vol. 31(1), pages 22-38.
    3. Hongxia Zhang & Zixuan Sun & Ehsan Elahi & Yuge Zhang, 2021. "Internet Development, Level of Industrial Synergy, and Urban Innovation," Sustainability, MDPI, vol. 13(22), pages 1-12, November.
    4. Goodman-Bacon, Andrew, 2021. "Difference-in-differences with variation in treatment timing," Journal of Econometrics, Elsevier, vol. 225(2), pages 254-277.
    5. Callaway, Brantly & Sant’Anna, Pedro H.C., 2021. "Difference-in-Differences with multiple time periods," Journal of Econometrics, Elsevier, vol. 225(2), pages 200-230.
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