Towards sustainable development: How industrial land leasing affects urban green innovation?

The transformation of industrial land use is critical in balancing economic performance and environmental benefits, particularly in improving urban green innovation. This study proposes a novel theoretical framework incorporating industrial land leasing, green development attention, co-agglomeration, and urban green innovation. Utilizing concepts from new economic geography and agglomeration theory, we empirically test this framework with data collected from various cities and industries across China from 2010 to 2021. Our results reveal an inverted U-shaped relationship between industrial land leasing and urban green innovation, indicating that there is an optimal level of industrial land leasing to promote urban green innovation. Additionally, the strength of this effect is influenced by the resource endowments and land supply conditions of different cities. Mechanism analysis indicates that industrial land leasing hinders urban green innovation primarily by diverting the government's attention away from green development. Nevertheless, industrial co-agglomeration can effectively mitigate this negative impact in the short term by improving resource sharing and knowledge spillover, thereby offering a potential buffer mechanism for promoting urban green innovation. This work provides valuable insights into economic green growth and sustainable development, and improves our understanding of optimizing resource allocation to promote urban green innovation. • Integrates industrial land leasing, green attention, co-agglomeration, and green innovation into a unified framework. • Reveals an inverted U-shaped relationship between industrial land leasing and urban green innovation. • Excessive leasing of industrial land has reduced the government's attention on green development. • Co-agglomeration can mitigate the negative effects of industrial land leasing on green innovation.