Air pollution, human capital, and urban innovation in China

Air pollution and urban innovation are two important issues that have accompanied China’s economic growth in the past decade. Based on the quasi-natural experiment of central heating in northern China in winter, this paper uses regression discontinuity design (RDD) to isolate the causal relationship between air pollution and urban innovation in China by matching urban data with multiple micro databases. Further, the possible influencing mechanism is discussed from the perspective of human capital. The results show that—air pollution significantly inhibits urban innovation—specifically, a 1% increase in air pollution significantly reduces urban innovation by 1.463%; compared with non-invention patents, air pollution has a more obvious inhibitory effect on invention patents with higher innovation capacity requirements and technology content. In terms of the impact mechanism, air pollution may undermine urban innovation by impairing healthy human capital and increasing the emigration of high-level human capital from cities.