Are cities greener because of innovation? Independent innovation policy and green economic efficiency

Abstract

The national independent innovation demonstration zone (NIIDZ) is an independent innovation policy that plays a crucial role in implementing strategies. Given the importance of the NIIDZ, this study uses panel data of 278 prefecture-level cities in China from 2006 to 2020 and empirically examines the effect and internal mechanism of the NIIDZ on green economic efficiency (GEE) using the difference-in-difference model (DID). The results show that the NIIDZ effectively enhances the growth of GEE, and the results remain valid through several robustness tests, such as year-by-year propensity score matching. The transmission mechanism suggests that the NIIDZ indirectly drives GEE by accelerating scientific and technological investment, promoting talent concentration, and optimizing the industrial structure. Moreover, heterogeneity analysis reveals that the promotion effect of the NIIDZ on GEE is more prominent in the eastern region and high green development level areas. The study’s findings can serve as a reference for China to further utilize the policy effectiveness of the NIIDZ and accelerate the high-quality development of the green economy in the future.

Keywords

• National innovation independent demonstration Zone (NIIDZ)
• Green economy efficiency (GEE)
• Difference-in-difference model (DID)