Is Renewable Energy A Curse or Blessing? Evidence from Solar Power

Employing a spatial equilibrium model and exploiting staggered solar farm installations across Chinese counties, this study reveals that solar energy development reduces local GDP per capita by an average of 2.7\%. This negative effect, primarily from competition for high-value land, is more pronounced in counties with high land opportunity costs. We observe a 2\% increase in the local population despite lower wages and higher housing prices, implying improvements in local amenities. This paper reframes the resource curse debate by examining the impacts of renewable energy, specifically solar power.