Exploring the causal relationship between urbanization and air pollution: Evidence from China

Urbanization and air quality are both closely linked to sustainable development and human well-being. However, few studies discussed the improvement effect, stage characteristics, and time-lag effects of urbanization on air quality. It is not clear whether China's air pollution has decoupled from urbanization. Based on the population, economic, land, and social dimensions, we analyzed the relationship between China's urbanization and air pollution using fully modified least squares, Granger causality test, impulse response functions, and variance decomposition. The results show that urbanization has both negative and positive effects on air quality, which is related to the urbanization stages and policies. From 2000 to 2012, each 1% increase in population, economic, land, and social urbanization increased PM2.5 concentration by-0.28%, 0.71%, 0.04%, and 0.16%, respectively. However, from 2013 to 2019, the effects were mostly not significant. The increasing urbanization rate could reduce PM2.5 concentrations during the entire period. Bi-directional long-term causality between population, economic, and land urbanization and PM2.5 concentration existed before 2013, after which causality became unidirectional, and the effects of PM2.5 concentrations on urbanization weakened. The impact of urbanization could last for 6-8 years. PM2.5 concentrations were decoupled from all dimensions of urbanization after 2015 in China. This study provides a useful reference for government decision-making and also gives insights and methods to other studies.