Can digital infrastructure induce urban green innovation? New insights from China

Selecting the panel data for 280 Chinese cities during 2011-2019, we first measure the digital infrastructure (DI) development level in each city by adopting the entropy method and then employ the two-way fixed effect model to examine the effect and its mechanisms of DI on urban green innovation (GI). Empirical results robustly show that DI can significantly promote urban GI, especially in large, high-grade, and high-level economic development cities. Mechanism analysis suggests that DI mainly promotes urban GI through three channels: promoting economic agglomeration, boosting digital inclusive finance (DIF) development, and raising public environmental attention. Meanwhile, the stronger the intellectual property protection (IPP) by local governments, the greater the promoting effect of DI on urban GI. Further research shows that GI can reduce carbon dioxide (CO2) emissions in both total and intensity dimensions. Our findings not only demonstrate the positive externality effect of DI, but also provide valuable references for government departments to further layout DI in the future.