The Ambient Air Quality Standards, green innovation, and urban air quality: Evidence from China

As the Chinese economy entering the transition period, the environmental issues have become the one of most concerned topics. Based on panel data of 284 prefecture-level and above cities in China from 2006-2019, this study discusses the regulatory effects of the Ambient Air Quality Standards (AAQS) on urban air quality and its spatial spillover using the various DID models, and further builds a serial multiple mediation model to analyze the channel role of green innovation. The results reveal that (1) the implementation of the AAQS has a positive regulation effect on urban air quality, yet with a “inverted V-shaped” trend; (2) local implementation of the AAQS worsens the air quality of geographically adjacent cities within 400 km, while the effect is reversed for cities that are beyond 400 km; (3) heterogeneity analysis shows that the AAQS improves the air quality of central cities, medium-sized cities, cities of weak-intensity of environmental governance, recession or regeneration resource-based cities; and (4) it might reduce urban air quality only by inducing the green innovation per se. However, either by energy-use effect or industrial-structure effect triggered by the green innovation, can the AAQS favorably enhance urban air quality.