The Impact of Low-Carbon City Pilot Policies on Green Innovation Efficiency in Chinese Cities: An Empirical Analysis Based on the Multi-Period PSM-DID Model

On the basis of panel data taken from 226 Chinese cities in the period 2008 to 2019, this paper measures urban green innovation efficiency, with the help of the unexpected production output-stochastic block model (UPO-SBM), and applies the propensity score matching difference-in-differences (PSM-DID) model to analyze the impact of low-carbon city pilot policies (LCPP) on urban green innovation efficiency. This paper also applies a mediation effect model to analyze the mechanism of the LCPP that enhances urban green innovation efficiency, and also attempts to explore the impact of the LCPP on the green innovation efficiency of various types of cities by engaging with multiple dimensions. The results of the study shows that: (1) When all other conditions remain unchanged, the average promotion effect of the implementation of the LCPP on urban green innovation efficiency is 21.77%; (2) at 1% significance level, the mediating effect of financial technology R&D expenditure and environmental governance expenditure is 0.0664 and 0.0283, respectively, confirming that both are important to the role that LCPP plays; (3) at 5% significance level, the exogenous policy effect of the LCPP on urban green innovation efficiency is more obvious in cities with a larger population size and higher degree of development, whose pillar industry is heavy industry.