Innovation and sustainable: Can innovative city improve energy efficiency?

This paper studies the impact of the construction of innovative cities on cities' energy efficiency. Using panel data of cities from 2005 to 2017, we take the implementation of the National Innovative Polit City Policy (NIPCP) in China as a quasi-natural experiment and identify its impact on improving cities' energy efficiency. Further, for the potential mechanism, we find that NIPCP not only enhances energy efficiency directly by establishing energy-related assessment indicators but also indirectly through the optimization of industrial structures and the promotion of urban innovation level, promoting the transformation to energy-saving cities. Considering the heterogeneity of cities, NIPCP has a greater effect on cities in the west, resource-based cities, provincial capitals, and small and medium-sized cities. Our empirical evidence strongly supports that NIPCP can realize a win-win situation for the energy and economy.