Achieving the synergy of pollution and carbon emission reductions: Can artificial intelligence applications work?

Jie Dian, Shanmin Li and Tian Song

China Economic Review, 2025, vol. 91, issue C

Abstract: Artificial intelligence (AI), a key driving force in a new wave of scientific and technological revolution, contributes to green improvements in industrial production processes. Its rapid development provides a potentially feasible path for China to achieve the synergistic effects of pollution and carbon emission reductions. This study expands the production task model to theoretically analyze the impact and mechanism of AI applications on the synergy of pollution and carbon emission reductions. On this basis, we utilized panel data from Chinese cities to conduct empirical tests. The results indicated that AI applications have a considerable synergistic effect on pollution and carbon emission reductions. Technological innovation, energy structure optimization, and labor substitution are identified as the primary channels. The effects vary by urban location, characteristics, and industry. Compared with those in eastern and central cities, AI applications in western cities have a more pronounced impact on emissions reduction. Factors such as low human capital, high financial development, and moderate fiscal expenditure are more conducive to the effective application of AI. Moreover, the demonstration and competitive functions of AI applications generate substantial spatial spillover effects. The findings provide valuable policy insights for promoting urban intellectualization and greenization.

Keywords: Artificial intelligence applications; Synergy of pollution and carbon emission reductions; Technological innovation; Energy structure optimization; Labor substitution (search for similar items in EconPapers)
JEL-codes: J24 O33 Q43 Q52 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:91:y:2025:i:c:s1043951x25000471

DOI: 10.1016/j.chieco.2025.102389

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