The path of technological progress for China's low-carbon development: Evidence from three urban agglomerations

It is widely believed that technological progress is the key driving force for low-carbon development. Based on a panel data of 50 cities during the period 2005-2014 in China's three urban agglomerations (“Beijing-Tianjin-Hebei”, “Yangtze River Delta”, and “Pearl River Delta”), this paper presents a comprehensive analysis on the path of technological progress for the low-carbon development. Specifically, it firstly estimates the factor-biased technological progress by using a translog production function model, and then dynamic panel data models are used to investigate the impacts of three sources of technological progress including R&D, FDI and international trade (import and export) on the factor-biased technological progress; finally, we introduce an index to measure the appropriate technical structure, and analyze the technological improvement strategy to the low-carbon development. The main results indicate that technological progress of the three urban agglomerations is biased toward electricity, thereby shows a electricity-saving effect; FDI shows electricity-saving and carbon reduction effects, but R&D activities do not show the electricity-saving effect; the impacts of import and export on the factor-biased technological progress are weak. Furthermore, the path of technological progress is highly related to the level of economy, when GDP per capita is higher than 37,000 yuan, indigenous innovation is the main driver for low-carbon development.