Public–private partnerships and carbon reduction targets: evidence from PPP investments in energy and environmental protection in China

Xinshuo Hou, Weiling Li, Dongyang Li () and Jianghuan Peng
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Xinshuo Hou: Xiangtan University
Weiling Li: Xiangtan University
Dongyang Li: Xiangtan University
Jianghuan Peng: Xiangtan University

Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, 2025, vol. 27, issue 3, No 36, 6567-6597

Abstract: Abstract Public–private partnerships (PPPs) are frequently employed in the energy and environmental protection sectors, referred to as PPPEEs. Theoretically, PPPEEs offer potential solutions to alleviate the government’s financial burden in reducing emissions and guide industries toward a low-carbon transformation. However, existing literature falls short in addressing the relationship between PPPs and carbon intensity. According to a panel data set for 284 Chinese cities from 2003 to 2020, this study investigates the impact of PPPEEs on carbon intensity and the moderating effect of other variables on it. First, this study builds a staggered difference-in-difference (DID) model to investigate the link between carbon intensity and PPPEEs empirically. Evidence from the real world strongly suggests that PPPEEs have a negative impact on carbon intensity. Then, we used the parallel trend test, placebo test, the instrumental variables approach, and other robust tests to prove the basic conclusion’s validity. Besides, the experiments imply no environmental Kuznets curve (EKC) of the carbon intensity problem, only a monotonically declining process. Finally, the moderating effect analysis implies that population density has a quantitative effect and that the degree of investment has a nonlinear effect. However, due to the rebound effect, the moderating influence of urban innovation is not considerable. This study provides an important theoretical basis for promoting PPPEEs to achieve urban low-carbon transformation and development.

Keywords: DID model; Moderating effect; Size difference; Population density; Innovation capability (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s10668-023-04155-3

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