The impact of factor market integration on carbon emission performance? – evidence based on spatial econometric model

Drawing from panel data spanning 2003 to 2019, encompassing 30 provinces in China, this study employs the relative price method and the super-efficiency EBM technique to assess the market integration index and the level of carbon emission performance, respectively. Furthermore, it employs the Spatial Durbin model to delve into the spatial impact and mechanisms of factor market integration on carbon emission performance. The findings indicate that the integration of factor markets significantly enhances carbon emission performance. Notably, the integration of labor markets has a more profound impact on the enhancement of carbon emission performance compared to capital market integration. Furthermore, the spatial decomposition effect reveals that the indirect spillover effects of factor market integration surpass its direct effects. Heterogeneity analysis shows that factor market integration in the eastern region has a greater promoting effect on the level of carbon emission performance. In the areas with high industrial quality, the promoting effect of labor market integration on carbon emission performance is more significant. The analysis of the spillover effect indicates that as the spillover distance increases, the impact of factor market integration on the marginal effect of carbon emissions exhibits a positive U-shaped pattern. This pattern manifests as a marginal decreasing trend within a distance of 600 km, followed by a marginal increasing trend beyond 600 km. This study has important reference value for government departments to formulate unified large-market construction policies to achieve high-quality development.