**2. Theoretical Analysis**

A large number of theoretical and empirical studies show that the city cluster can have a positive effect on economic productivity, technological innovation capacity, and industrial structure optimization through the agglomeration of factors. Details are as follows.

First, the city cluster can reduce carbon emissions by improving city productivity. Generally speaking, the public infrastructure construction of member cities in the city cluster can be further improved, by, for example, improving the railway station [16]. Infrastructure improvements can help foster city networks that enable the flow of people and capital among cities [17]. The formation of a city cluster can improve the capacity of resource allocation in a larger region. It helps the flow of production elements from large to small and medium-sized cities, and improves the aggregation economic and ecological efficiency of small and medium-sized cities [18]. In addition, the scale effect generated by the city cluster has contributed to an increase in city productivity.

With the implementation of the city cluster, the production costs and price index of products would decrease, leading to the expansion of local demand and market size. The increased returns to scale resulting from this expansion will further promote agglomeration and thus increase regional productivity. The increasing returns to scale generated by expansion further promote agglomeration and improve regional production productivity.

Secondly, the city cluster can reduce carbon emissions through technology. On the one hand, economic growth in cities is accompanied by the build-up of human capital and the overflow of knowledge. The city cluster can increase opportunities for the inter-regional exchange of people and learning, and promote collaborative research and development [19], thus accelerating the diffusion and application of knowledge and new technologies within the region and promoting technological progress. Therefore, the clustering spillover effects of sharing, matching, and learning mechanisms within large cities are more obvious than those in small cities [20], which will accelerate the dissemination and application of knowledge and new technologies within the region and thus promote technological progress.

On the other hand, the city cluster significantly improves market openness and facilitates the aggregation of high-quality factors in the city cluster. Non-local enterprises bring the cross-regional flow of enterprise innovation factors, creating favorable conditions for inter-regional knowledge spillover and improving innovation efficiency [21]. In conclusion, the knowledge spillover brought by the city cluster can not only promote local technological progress, but also have a significant impact on the technological progress of neighboring regions as well through the cross-regional flow of innovation factors.

Finally, the city cluster can reduce carbon emissions through industrial structure upgrading. The optimization of industrial structure and energy efficiency are key factors in carbon reduction [22,23]. The city cluster reduces barriers for non-local enterprises and foreign investment to enter the local market by lowering trade barriers within cities, which accelerates competition among enterprises within the market. To survive, enterprises will eventually choose industrial structure upgrading through the market competition mechanism. At the same time, the hierarchy produced in the development of the city cluster is inevitably accompanied by various degrees of specialization. Diversified metropolises will take on the role of incubators for innovative industries, while small and medium-sized cities will use their comparative advantage in production factors to reduce production costs and become agglomerations for some industries [24]. Referring to Ó Huallacháin and Lee (2011) [25], specialized production facilitates eco-efficiency through channels such as the promotion of economic factor aggregation, technological progress, resource intensification, and Marshallian externalities. Therefore, the optimization of a city system stemming from the development of the city cluster will promote the industrial structure upgrading.

Therefore, based on the above analysis, this paper puts forward three assumptions, as shown in Figure 1.

**Hypothesis 1.** *City cluster pilot policy can reduce carbon emissions by increasing city productivity.*

**Hypothesis 2.** *City cluster pilot policy can reduce carbon emissions by improving the level of technological innovation.*

**Hypothesis 3.** *City cluster pilot policy can reduce carbon emissions through optimizing industrial structures.*

**Figure 1.** Theoretical hypothesis framework.

#### **3. Data and Empirical Design**

*3.1. Data*

We investigate the impact of city cluster policy on carbon emissions according to the panel data of 108 Chinese cities in the Yangtze River economic belt from 2003–2017. Our carbon emissions data were obtained from the Carbon Emission Accounts and Database https://www.ceads.net/ (accessed on 5 May 2022); other city data are from the China City Statistics Yearbook. The carbon emissions data are only updated to 2017. Our final sample consists of 1620 city-year observations covering the 2003–2017 period.
