Can intellectual property protection reduce carbon emissions? A quasi-natural experiment from China

Xiaoxiao Zhou, Mengyu Jia and Hua Zhang

Applied Economics, 2025, vol. 57, issue 11, 1163-1182

Abstract: Intellectual property rights (IPR) protection is an important incentive for green innovation and carbon reduction. A better understanding of the effect of IPR protection on carbon emissions (CEs) remains vital to carbon neutrality in China. An evolutionary game model was constructed to depict the multidimensional theoretical channels from IPR protection to CEs. Drawing from 284 Chinese cities’ data (2003–2019), this paper empirically identified the reduction effect of intellectual property city (IPC) construction on CEs with difference-in-differences (DID) method. IPC construction reduced the cities’ CEs by 10.34%. It curbed CEs by promoting green technology and reducing energy consumption but failed to optimize industrial structures. The instrumental variable (IV) constructed by the number of Confucius temples also reveals that the construction of IPC can significantly curb CEs. This effect shows an increasing trend over time. However, it also carries heterogeneity, presenting significantly negative coefficients in eastern (−0.0976) and western (−0.2554), resource-poor (−0.1303), highly marketable (−0.943), and environmentally friendly cities (−0.0786), but insignificant effects in other cities. For enabling China to meet its carbon-neutrality target, several improvements are needed. These include the implementation of differentiated IPR protection, strengthened supervision, and enhanced optimization of the basic green environment.

Date: 2025
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DOI: 10.1080/00036846.2024.2311070

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