Does climate policy exacerbate spatial development inequality? Quasi-experimental evidence from China

Xiaoke Zhu, Weigang Liu and Jian Liu

EconStor Open Access Articles and Book Chapters, 2025, vol. 120, 1-12

Abstract: This study aims to examine the causal relationship between climate policy and spatial development inequality within cities. To this end, we leverage the temporal and spatial variations in the implementation of the low-carbon city pilot initiative (LCCPI) to perform a staggered difference-in-difference (DID) estimation. Our estimated results demonstrate that the LCCPI is associated with an approximate 4.4 % reduction in the Gini coefficient for nighttime light intensity. Our findings are robust to alternative measures and different specifications. Further mechanism analyses reveal that the LCCPI operates by narrowing the green innovation gap and improving the factor allocation. Notably, we observe a more pronounced decrease in spatial development inequality in resource-dependent and high-marketization cities.

Keywords: climate policy; spatial development inequality; green innovation; factor allocation; staggered DID (search for similar items in EconPapers)
JEL-codes: D63 Q01 Q56 R11 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:espost:313120

DOI: 10.1016/j.scs.2025.106166

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