Does the Digital Economy Contribute to Low-Carbon Development? Evidence from China’s 278 Cities

The digital economy significantly changes China’s economy and environment. Previous studies assume the unilateral effect of the digital economy on China’s low-carbon development and produce controversial conclusions. In this study, we use the panel two-tier stochastic frontier analysis, and results show that (1) the digital economy produces double-sided effects (increasing and decreasing effects) on carbon productivity between 2011 and 2021; (2) the two-sided effects and the net effect of the digital economy appear differently in provinces, regions, and city groups; (3) the sub-indicators of the digital economy show various trends along with the carbon productivity in different regions and city groups; and (4) policy implications in adjusting the various sub-indicators of the digital economy to coordinate the digital economy and low-carbon development are made accordingly.