The effects of internet infrastructure on carbon neutrality

Weiteng Shen, Xuan Yu, Tong Sun, Tiejun Pan and Shunbin Zhong

International Review of Economics & Finance, 2025, vol. 99, issue C

Abstract: Internet infrastructure is a cornerstone of modern society, yet its environmental impact remains debated. While prior studies emphasize its role in carbon emissions, the broader climate effects—including carbon sinks—are poorly understood. This research addresses this gap by evaluating how China's national Broadband China Policy (BCP), a large-scale internet infrastructure initiative, influences both carbon emissions and carbon sinks. Using a staggered Difference-in-Differences (DID) approach to analyze the policy as a natural experiment, this study finds that the BCP led to an approximately 3.34% increase in total carbon sinks. While there is insufficient statistical evidence to support the BCP's effect on reducing overall carbon emissions, it has notably reduced the carbon emission intensity by approximately 5.3%. This reduction in energy consumption in both industrial and residential sectors serves as a crucial pathway through which the BCP contributes to carbon emission reduction. Additionally, enhancing forest and grassland cover, achieved by boosting public awareness of climate change issues, plays a vital role in the BCP's carbon sink effects. Cities with greater technological absorptive capacity experience more significant reductions in carbon emission intensity due to the BCP. Similarly, cities with more educated residents experience greater reductions in carbon emission intensity and enhanced carbon sink effects due to the BCP. These findings provide new insights into the climate change benefits associated with internet infrastructure and offer additional policy tools for reducing carbon emissions and enhancing carbon sinks.

Keywords: Broadband China policy; Carbon neutrality; Carbon emissions; Carbon sinks (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:99:y:2025:i:c:s1059056025001273

DOI: 10.1016/j.iref.2025.103964

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