The National Key Ecological Functional Areas (NKEFAs) are location-oriented ecological engineering of China, which rely on the main functional area planning. The co-benefits of ecological product supply and ecological environment improvement of NKEFAs has not been fully assessed in the literature.
NKEFAs is considered a quasi-natural experiment, and the time-varying difference-in-differences (DID) model is used to assess the impact of NKEFAs on carbon sequestration (CS) and environmental quality (EQ) based on the panel data of 330 cities in China from 2001 to 2019. Then, we explore whether the co-benefits of ecological product supply and eco-environment protection can be achieved.
NKEFAs can enhance CS and EQ and thus achieve co-benefits for both. NKEFAs can achieve the co-benefits of CS and EQ through territory spatial allocation and labor force aggregation, but industrial structure upgrading only positively mediates the impact of NKEFAs on CS. The co-benefits of CS and EQ are heterogeneous across functional area types, geospatial locations, and quantiles, while only CS at windbreak-sand fixation area, northwestern region, and low quantile regions is enhanced. This study makes a theoretical and methodological contribution to the existing literature on the policy effect assessment of ecological engineering. It also provides a comprehensive framework for evaluating the ecological effects of relevant policies in other countries by integrating the co-benefits of ecological products and eco-environment, analyzing regional heterogeneity, and exploring the underlying mechanisms.