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<p>As a crucial initiative to accelerate the green transition and development, China’s Low-Carbon City Pilot Policy (LCCP) has raised questions about its compatibility with the energy demand and carbon implications of artificial intelligence (AI) industrial growth. This study treats the LCCP as a quasi-natural experiment and uses a staggered difference-in-differences (DID) framework to examine its relationship with urban AI industry development. The analysis covers 285 Chinese prefecture-level cities from 2007 to 2022 and further examines potential mechanisms and heterogeneity. The results indicate that the LCCP is associated with higher AI industry development in pilot cities: in the fully specified model, the estimated coefficient is 0.156, which corresponds to an approximately 16.9% higher level of AI enterprises relative to comparable non-pilot cities. Mechanism tests suggest that this relationship operates partly through improvements in energy consumption structure and green technology innovation. Heterogeneity analysis further indicates that the policy effect varies across local contexts, with evidence of stronger effects in established innovation hubs and in some follower regions undergoing industrial transition. The study provides empirical evidence on the compatibility of green and digital transitions and offers policy insights on how environmental regulation may be coordinated with high-tech regional development.</p>

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Do low-carbon cities hinder AI industry growth? Evidence from China

  • 期刊论文

  • 出版模式：

    开放获取

  • 发表日期：

    2026年7月2日

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  • Luyuan Tang,
  • Shiyao Xie,
  • Yuan Xu,
  • Ziwen Sun

摘要

As a crucial initiative to accelerate the green transition and development, China’s Low-Carbon City Pilot Policy (LCCP) has raised questions about its compatibility with the energy demand and carbon implications of artificial intelligence (AI) industrial growth. This study treats the LCCP as a quasi-natural experiment and uses a staggered difference-in-differences (DID) framework to examine its relationship with urban AI industry development. The analysis covers 285 Chinese prefecture-level cities from 2007 to 2022 and further examines potential mechanisms and heterogeneity. The results indicate that the LCCP is associated with higher AI industry development in pilot cities: in the fully specified model, the estimated coefficient is 0.156, which corresponds to an approximately 16.9% higher level of AI enterprises relative to comparable non-pilot cities. Mechanism tests suggest that this relationship operates partly through improvements in energy consumption structure and green technology innovation. Heterogeneity analysis further indicates that the policy effect varies across local contexts, with evidence of stronger effects in established innovation hubs and in some follower regions undergoing industrial transition. The study provides empirical evidence on the compatibility of green and digital transitions and offers policy insights on how environmental regulation may be coordinated with high-tech regional development.