The Carbon Reduction Effects of Urban Green and Low-Carbon Transition Policies: Synergies Derived from Pilot Schemes for Carbon Trading and Green Credit Interest Subsidies

Carbon trading and green credit interest subsidies are two typical market-based environmental regulatory tools. Whether these two policies produce synergistic effects on regional carbon emissions reduction remains an important question. Using panel data from 274 prefecture-level cities in China, this study employs a difference-in-differences model to assess the impact of policy coordination on regional carbon emissions. The mechanisms are examined from two aspects: emission reduction and efficiency gains. The results show that policy synergy has a significant effect on regional carbon reduction. This effect is achieved by reducing energy intensity and improving green total factor productivity, which reflects structural and technical efficiency effects. The carbon-reduction effect of policy synergy is more significant in coastal cities, large and medium-sized cities, and administrative centres. However, a reverse effect is observed in non-administrative centres. These findings provide guidance and support for the coordinated implementation of carbon reduction policies.