Does smart city pilot policy reduce CO2 emissions from industrial firms? Insights from China

As major producers in the national economy, industrial enterprises bear great responsibility for carbon emissions. A smart city pilot policy (SCPP) with innovative advantages and environmentally friendly features provides a feasible way to scientifically achieve carbon emission reduction targets while maintaining industrial growth. However, there is a lack of specific understanding of the microscopic carbon reduction mechanisms of the policy. Thus, based on the data of A-share listed industrial firms from 2009 to 2018 in China, this study explores the impact mechanism of the SCPP on the CO2 emissions from industrial firms with the time-varying DID methodology and the mediating effect model. The results demonstrate that the SCPP can curb CO2 emissions from industrial firms in China by 23% by strengthening the intensity of environmental regulation and promoting green technological innovation. Further analysis indicates that the mediating effect of resource allocation efficiency only works in industrial firms in low-carbon industries, not high-carbon industries. In addition, the heterogeneity test suggests a pronounced reduction effect of the SCPP on non-state-owned enterprises (non-SOEs), and industrial enterprises in low-carbon industries, resource-based cities and eastern China. This paper is of great significance for providing theoretical and practical implications for making rational use of smart city policies to improve the carbon reduction performance of enterprises.