Effects of inter-industry agglomeration on environmental pollution: Evidence from China

Industrial pollution comes not only from within industries, but also from between industries that are strongly linked. From the perspective of agglomeration, this study explores the mutual transmission of pollution between different manufacturing industries. We found that there is an inverted U-shape relationship between inter-industry agglomeration and environmental pollution among 20 Chinese manufacturing industries. Energy intensity, which is an important transmission path from agglomeration to pollution, is positively related to the energy consumption of industries with some degree of agglomeration. Besides, the expansion of production scale caused by inter-industry agglomeration leads to more energy consumption and pollution. Furthermore, the innovative technology resulting from inter-industry agglomeration reduces environmental pollution but does not have a significant impact on energy consumption.