Innovation-economic trade-offs:A perspective of low-carbon policy intensity

Abstract

Existing literature emphasizes low-carbon policy implementation and benefits but overlooks intensity effects and trade-offs. This study introduces a low-carbon policy intensity index, a composite indicator of stringency and prioritization, to analyze the effects of policy intensity on city-level carbon total factor productivity and identify potential trade-offs. The analysis demonstrates spatial heterogeneity in policy effectiveness, with less-developed, resource-dependent, and small cities exhibiting heightened responsiveness to rigorous measures. Key mechanisms include green technology innovation and efficiency catch-up effects. However, two trade-offs emerge: (1) innovation tends to prioritize quantity over quality; (2) industrial restructuring generates short-term economic transition pressures. Scenario analysis shows that economic structural adjustment—particularly electricity optimization can mitigate these dilemmas by sustaining growth while curbing emissions. These findings demonstrate that shifting from nominal policy adoption to structural reforms and optimized intensity is key to balancing economic and environmental goals.