Can digital economy reduce carbon emission intensity? Empirical evidence from China's smart city pilot policies

With the rapid development of digital technology worldwide, can the digital economy promote not only macroeconomic growth but also green and low-carbon economic development? On the basis of the urban panel data in China from 2000 to 2019, this study uses a staggered difference-in-difference (DID) model to explore whether or how the digital economy reduces carbon emission intensity. Results show the following. (1) The development of digital economy is conducive to reducing the carbon emission intensity of local cities, and the above conclusion is relatively stable. (2) There is strong heterogeneity in the impact of digital economy development on carbon emission intensity in different regions and different types of cities. Chinese smart city construction in southern cities, non-resource-based cities, and environment protection-focused cities significantly reduces urban carbon emission intensity. (3) Mechanism analysis shows that the digital economy can promote the upgrading of the industrial structure, improve the efficiency of energy utilization, improve the efficiency of environmental regulation, reduce the mobility of the urban population, improve the environmental protection awareness of residents, promote the modernization of social services, and achieve emission reduction from the "production side" and "living side." (4) Further analysis shows the change of the influence between the two in the space-time dimension. In the spatial dimension, the development of digital economy can promote the reduction of carbon emission intensity in neighboring cities. In the time dimension, the early stage of digital economy development may increase the intensity of urban carbon emissions. The energy-intensive nature of digital infrastructure leads to lower energy utilization efficiency in cities, thus improving urban carbon emission intensity.