The Dual Pathways of Digital Innovation to Carbon Reduction in Chinese Cities: Local Synergy and Spatial Spillover

Understanding the pathways through which digital innovation contributes to carbon emission reduction is crucial for designing effective climate policies. Existing studies generally find a negative association between digitalization and carbon emissions, but they often treat this relationship as a “black box” and pay insufficient attention to the distinct local and spatial mechanisms through which digital innovation operates. This paper investigates the impact of digital innovation on city-level carbon emissions in 283 Chinese cities from 2010 to 2020 and decomposes the total effect into a local synergistic effect and a spatial spillover effect using a Spatial Durbin Model. We further conduct an empirical test of the underlying mechanisms, including energy efficiency gains and industrial structure upgrading for the local synergy pathway, and green technology diffusion for the spatial spillover pathway. The results indicate that (1) digital innovation significantly reduces city-level carbon emissions, confirming an overall negative effect; (2) spatial decomposition reveals two simultaneous pathways, with a significant local synergistic effect within cities and a spatial spillover effect to neighboring cities; (3) the mechanism analysis shows that the local synergy is significantly associated with improvements in energy efficiency and industrial upgrading, whereas the spatial spillover is significantly associated with the diffusion of green patents; and (4) the effects are especially pronounced in technology-intensive industries and cities in more advanced regions. These findings imply that carbon reduction driven by digital innovation occurs through both intra-city optimization and inter-city technology diffusion. Therefore, policies should not only motivate cities to strengthen their own digital capacities, but also promote interregional collaboration to enhance positive spillovers and achieve cost-effective and well-coordinated carbon neutrality.