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The effectiveness of carbon price in emissions trading schemes (ETS) is an important issue in China in the context of its ambitious climate change goals. This paper adopts a staggered difference-in-differences model to estimate whether China's ETS reduced CO2 emissions while maintaining economic growth even under low carbon prices. The results indicate that despite the low carbon prices, the ETS effectively reduced CO2 emissions without undermining the economy. Specifically, an increase of $1 in the carbon price reduced CO2 emissions by 1.69% and increased the per capita GDP by $286. The carbon price primarily achieved emission reduction and promoted economic development through channels, such as technological innovation, foreign direct investment, energy mix, and industrial structure. Carbon leakage to neighboring regions was not evident. Heterogeneity analysis showed that the environmental effects of the carbon price were more pronounced in regions with higher levels of economic development and CO2 emissions. Conversely, the economic effects of the carbon price were more pronounced in regions with lower levels of economic development and CO2 emissions. The carbon price achieved significant economic effects in regions that solely adopted the free allocation mode of emission allowances, while regions that used a combination of free allocation and auctioning experienced substantial emission reduction effects. Despite low carbon prices, China's ETS effectively reduced CO2 emissions without compromising economic growth. This finding provides new empirical evidence for the effectiveness of carbon price as well as decision support for the future promotion of ETS. Technological innovation, FDI, energy mix, and industrial structure are crucial channels through which the carbon price achieves emission reduction and promotes economic development. The absence of carbon leakage to neighboring regions suggests that ETS is an internally effective mechanism for emission control. Heterogeneity analysis showed that regional characteristics and allowance allocation modes can influence the effectiveness of carbon price, thus emphasizing the importance of targeted policy design and appropriate allocation methods. [ABSTRACT FROM AUTHOR]

Whether the carbon market can promote green technology innovation is a controversial topic because of an incomplete understanding of the mechanism and inconsistent datasets. This study first comprehensively explores the theoretical mechanism of the carbon market on green technology innovation from four aspects: the compensation effect, cost control motivation, crowding-out effect, and spillover effect. A sample of 209 cities in China is employed to empirically test the impact of China's pilot carbon market on green technology innovation and its regional and industry heterogeneity using quasi-natural experiments. We found that China's pilot carbon market has significantly promoted green technology innovation at the city level, especially in provincial capital cities, achieving a maximum effect two years after the shock. However, there is no significant spillover effect on the surrounding non-pilot cities, and Chongqing has realized the suppression of green technology innovation under the domination of the crowding-out effect. At the industry level, the pilot carbon market significantly promotes green technology innovation in the transportation, construction, chemical, and power industries but exhibits crowding-out effects in the steel industry. Finally, we propose policy implications for maintaining reasonable and stable carbon prices to stimulate compensation effects, scientifically determining the order of industry inclusion to avoid crowding-out effects, and accelerating inter-regional supply chains and technological cooperation to release spillover effects. It is recommended to scientifically determine a reasonable carbon price range and introduce institutions, individuals, and other trading entities to improve the liquidity of the carbon market and the effectiveness of carbon prices. Considering the high cost triggered by the complex processes of the steel industry in developing countries, its inclusion may inhibit green technology innovation; thus, it is necessary to be cautious about including the steel industry in the carbon market. To build a carbon market in developing countries, the order of industry inclusion must be determined based on scientific calculations of the costs of green technology innovation in the industry. Avoid using self-declaration for carbon quota allocation and focus on improving national basic innovation capabilities to ensure the supply of green technology innovation. [ABSTRACT FROM AUTHOR]

Emissions trading schemes (ETS) area is a leading climate policy instrument worldwide and have been widely discussed and researched. However, few studies to date focus on the nexus of ETS and income inequality, an important socioeconomic phenomenon. To fill this gap, taking China as an example, this paper discusses the influence of ETS on income inequality and its dynamic changes using a time-varying differences-in-difference model combined with a propensity score matching approach. The results demonstrate that China's pilot ETS has contributed to reducing income inequality. Various robustness tests support this conclusion. Moreover, the strength of ETS's contribution to reduction in income inequality gradually increases over time. We further analyze the mediating effects of carbon intensity, energy consumption, industrial structure, and technological innovation. ETS reduces income inequality by reducing coal consumption. The regional heterogeneity analysis shows that, unlike in other regions, ETS has a positive impact on income inequality (i.e. it increases it) in the eastern region in China due to its optimized energy structure and relatively complete, open, and flexible economy system. The paper discusses the above findings and their policy implications. It is also designed to promote research on ETS and to diversify research perspectives of income inequality from both theoretical and practical aspects. Evidence from China's pilot experience with ETS shows that it contributes significantly to balancing income distribution and alleviating the increasingly acute social conflicts caused by income inequality. This provides new theoretical and decision support for the promotion of ETS in the future. The energy revolution driven by ETS promotes income redistribution, which is conducive to income equality. Governments should enforce the constraints of ETS on power generation companies; guide capital to invest more in the non-thermal power industry, especially the renewable energy power sectors; and guide and regulate the income distribution in new power sectors. Governments' revenue from ETS can and should be used to further redistribution of income and to reduce income inequality. A higher number of free quotas and a lower carbon price could be imposed on low-profit or labor-intensive industries to reduce their emission costs. [ABSTRACT FROM AUTHOR]

Based on the relation analysis through the Vector Autoregressive (VAR) model, this study investigates the effect of the construction of low-carbon cities on haze pollution in China by using the Difference in Differences-Propensity Score Matching (PSM-DID) method. In addition, we examine the influencing mechanism of low-carbon city construction on haze pollution, namely technical innovation effect, industrial structure effect and population quality effect. The results show that the construction of low-carbon cities has not effectively reduced haze pollution in pilot cities. Further study shows that the failure of the reduction effect on haze pollution may lie in the ineffectiveness of technical innovation effect and population quality effect of low-carbon city construction, as well as the regional heterogeneity. Finally, we propose several recommendations in terms of overall construction strategies, green development of technology and industry, and regional heterogeneous policies to better alleviate China's haze pollution through the construction of low-carbon cities. [ABSTRACT FROM AUTHOR]

To facilitate and balance regional economic development and to reduce carbon emissions, China has implemented a series of policies to promote the redistribution of industries and economic activities across regions since 2000. This paper employs a logarithmic mean Divisia index (LMDI) to analyse the dynamic net effect on carbon emissions of Chinese policies promoting economic redistribution across sub-national regions, using a panel data of five sectors in 30 provinces during 1995–2017. The results of our analysis show that the redistribution of industry in particular, but also business and construction activities, leads to an increase in CO2 emissions, while the relocation of agriculture and transportation activities reduces emissions. We also find that the emission increase effect of the transfer of carbon intensive industries to new (host) regions is higher than the emission reduction effect induced by the agglomeration of clean industries in the original (home) regions. However, from 2014–2017, alongside the gradual industrial redistribution, China has also reduced aggregate CO2 emissions by 58.6 MT. In addition, the results show that population migration, which is due to redistribution of industry and other economic activity, has caused higher emission increases than emission reductions due to redistribution policies. We further calculate the marginal effect of industrial redistribution on CO2 emissions and draw out relevant policy implications. Key policy insights Industrial (and other economic activity) redistribution within a county can be not only an economic policy, but also an important policy instrument to mitigate CO2 emissions. This is the case in China. In the process of regional industrial redistribution, policymakers should aim to reduce the emission increase effect of transfer of carbon-intensive industries to host regions and to raise the emission reduction effect induced by an agglomeration of clean industries in home regions. Industrial redistribution is usually a long-term strategy for regional development within a county, and any reduction effects on CO2 emissions are likely to need time to appear. [ABSTRACT FROM AUTHOR]

The unflinching surge in global warming has left the world in ecological chaos. Consequently, governments across the globe are committing to achieving decarbonizing the environment with a target aimed at 2050, of which China is a key player. In effect, this study seeks to contribute to the strides by querying the extent to which shocks in technological innovation make or mar the sustainability of the Chinese environment from 1990 to 2019. The other impacts of foreign direct investment, renewable and nonrenewable energy, and economic growth are considered in the model estimated through nonlinear ARDL robust for ascertaining instantaneous positive and negative effects. The results reveal that technological innovation promotes and hinders environmental sustainability based on the positive and negative shocks, respectively, whereas the adverse shocks impede it. Besides, economic growth and nonrenewable energy turn out to be negative predictors of environmental sustainability while renewable energy and FDI facilitate it. The results of the Fourier Toda Yamamoto corroborate the NARDL results. The EKC hypothesis is not validated for China based on estimates from the novel Itkonen (2012) approach. Following the empirical results, practicable policy insights toward sustaining the environment in China and beyond are formulated. [ABSTRACT FROM AUTHOR]

The integration or segmentation of regional carbon prices implies that barriers may hinder prices from adjusting efficiently and impede linkages between regional carbon markets. Past studies have found that crossregional carbon prices in China tend to diverge, indicating unbalanced regional markets and that carbon cap-and-trade policies may be insufficiently effective. China's carbon trading pilots opened in 2013. Is the integration efficient? This is the research question addressed in this study. This paper uses the carbon prices of four carbon-trading pilot regions in China (i.e. Beijing, Shanghai, Tianjin, and Guangdong) over the period of January 1, 2014, to March 23, 2021, to explore whether prices are correlated across three dimensions: long-term convergence, short-term correlation, and volatility transmission by adopting a vector error correction model with heterogeneous variances. And by using longer-term daily data and empirical tests that can account for the multiple-faceted correlations, this paper provides evidence showing that long-term convergence and risk transfer between the four regional carbon prices exist, which indicates significant regional integration. The results indicate that the price behavior of the Beijing pilot is efficient and that the Shanghai pilot has the lowest volatility. The paper also documents an information transfer pattern. For example, the Beijing pilot is shown to be the leading risk transfer market, whereas the Shanghai pilot is shown to be the market where most risk is transferred. Contrary to findings elsewhere, our main results demonstrate that China's carbon markets exhibit integration efficiency and no imbalance between regions. This may be because the efficiency of China's carbon markets has improved over time. The evidence also implies that if a multi-dimensional correlation has not been considered, it may underestimate the efficiency of regional carbon prices' integration. [ABSTRACT FROM AUTHOR]

In recent years, improving semi-urbanization has emerged as a promising approach for reducing pollutant emissions. However, the environmental impacts of semi-urbanization are under-researched in the extant literature. To this end, this paper explores how semi-urbanization affects the collective reduction of carbon and pollutant emissions. Also, to account for potential spatial spillover effects, the internal impact mechanisms through which semi-urbanization affects carbon and pollutant emissions are discussed theoretically. The main results indicate that: (1) Semi-urbanization contributes to reducing carbon and pollutant emissions of the province along with its nearby areas. Specifically, every 1% rise in semi-urbanization of the province leads to a decrease in C O 2 emissions by around 0.93% and by around 7.04% of nearby areas; every 1% rise in semi-urbanization of the province decrease SW emissions by about 1.88% and by about 7.71% of nearby areas. (2) The relationship of semi-urbanization with carbon and pollutant emissions shows a significant U-shaped pattern. (3) Semi-urbanization, energy consumption, human capital, industrial structure, and energy efficiency exert significant and varying spatial effects on carbon and pollutant emissions across regions. This investigation suggests important policy recommendations. [ABSTRACT FROM AUTHOR]

To mitigate the detrimental effects of climate change exacerbated by excessive carbon emissions, China has introduced a series of environmental regulations designed to promote low-carbon technology diffusion among enterprises. The existing literature ignores the heterogeneity of the scales of enterprises, making it extremely difficult to put forward targeted policies for enterprises of different scales. In this study, we employ a complex network-based evolutionary game approach to analyze the effect of environmental regulations on the diffusion of low-carbon technology, and thereby determine the relationship between the degree of diffusion and the strength of regulations at different scales of enterprise. The results revealed that with respect to the degree of diffusion, there are significant differences in the sensitivity of enterprises in 20- and 100-scale networks to the imposition of three types of environmental regulation (innovation subsidy, carbon tax, and punishment). When the scale of the network is fixed, fluctuation in the change in degree becomes larger, and even irregular, with an increase in enterprise scale. With an increase in network scale for small, medium, and large enterprises, the range of variation in the degree of diffusion becomes smaller. In small, medium, and large enterprises, when the scale of the network increases from 20 to 100, the degree of diffusion will increase in response to the same strength of innovation subsidy, carbon tax, and punishment. With an increase in innovation subsidies, the diffusion degree of large enterprises will improve slightly. Moreover, for large enterprises, increasing the strength of punishment has no obvious effects with regards to improving the degree of diffusion. At all scales of enterprise, in both the 20- and 100-sacle networks, the degree of diffusion will increase with an increase in the strength of the carbon tax. [ABSTRACT FROM AUTHOR]

Carbon flow in forest products trade will affect the report of a country's carbon stock. This will have an impact on a country's contribution of carbon flows. Based on the analysis of China's forest product trade, this paper uses the stock-change approach, the production approach and the atmospheric-flow approach to calculate the changes of China's forest products trade carbon flows. Different carbon flow measurement approaches have very different results. From the perspective of the contribution of forest products to carbon flow, the production approach of calculation for forest products trade carbon flow has the largest contribution to atmospheric carbon flows. However, the calculation results of the stock-change approach and the atmospheric-flow approach are just the opposite, that is, the calculation for forest products trade has a negative contribution to China's carbon sinks, and forest products trade has become a source of carbon emissions. [ABSTRACT FROM AUTHOR]

The climate emergency calls for decisive actions to achieve CO2 emissions reductions globally and in China. Although China has made substantial progress in renewable energy deployment and has promised to achieve carbon neutrality by 2060, the increasing CO2 emissions reflect a paradox in China's energy revolution, suggesting that second-best choices are necessary. Large-scale deployment of carbon capture, utilization, and storage (CCUS) can avoid stranding assets in existing fossil energy industries and thus incur less resistance from incumbents. With an estimated storage capacity of 3120 GtCO2, China has great potential to deploy CCUS. The more quickly CCUS scales up, the less the cost of mitigation in the future. Although China has issued many policies to promote CCUS development and achieved significant progress through demonstration projects, barriers still exist for its large-scale deployment. Barriers include the lack of CCUS-specific legal and regulatory models, relatively high investment requirements, and low public perception and acceptance towards CCUS. To effectively promote this second-best choice, institutional reforms are critical, including enabling climate change legislation, carbon tax policy, risk avoidance and risk sharing measures, compensation, and strengthened public engagement. Key policy insights Large-scale deployment of Negative Emission Technologies will be needed in China and beyond to address the climate emergency. Market distortions impede renewable energy development in China, making large-scale deployment of CCUS an essential second-best choice. Detailed legal and regulatory rule changes can reduce market uncertainties and provide a legal foundation and mandate for CCUS development. Particularly when source control measures – such as renewable energy deployment, industrial restructuring and energy efficiency improvements – face bottlenecks, the scaling up of negative emission technologies is essential. International cooperation on CCUS technologies and deployment should be strengthened to share experience, technology, and deployment modes. [ABSTRACT FROM AUTHOR]