Industrial agglomeration and energy efficiency: A new perspective from market integration

Improving energy efficiency is critical for realizing energy conservation and emissions reductions. This study adopts a market integration perspective to undertake both theoretical analysis and empirical testing of the mechanisms underlying the impact of intra-industry and inter-industry agglomeration on energy efficiency within the context of China. The key findings are: (1) For intra-industry specialized agglomeration, market integration has conflicting moderating effects that offset each other. (2) For inter-industry diversified agglomeration, market integration has a singular moderating effect - as integration increases, the negative impact on energy efficiency diminishes. (3) The enhancement of market integration amplifies the "siphon effect" of industrial agglomeration, thereby intensifying the negative spatial spillage of industrial agglomeration to neighboring regions. This exacerbates the hindrance posed to energy efficiency improvements. This paper contributes to the current body of research on the determinants of energy efficiency, presenting valuable insights for guiding industrial agglomeration endeavors and formulating effective industrial policies.