Growth of industrial CO2 emissions in Shanghai city: Evidence from a dynamic vector autoregression analysis.

Carbon dioxide (CO 2 ) is one of the main sources of global warming, rising sea levels, and frequent outbreaks of extreme weather. China is now one of the largest energy consumer and CO 2 emitters in the world. As one of China's economic centers, Shanghai city has a perfect industrial system with large industrial scale. The industrial sector is an energy– and emission–intensive industry, which contributes the significant part of CO 2 emissions in Shanghai city. Therefore, an in–depth investigation of the main driving forces of CO 2 emissions in the industrial sector is essential to reduce CO 2 emissions in the city. This study uses Vector Autoregressive model to analyze the main factors causing the increase in CO 2 emissions in the industrial sector. The results show that economic growth leads to an increase in CO 2 emissions in the short run, but is conducive to reducing CO 2 emissions in the long run, due to the differences in fixed–asset investment and export trade. Energy consumption structure leads to a growing CO 2 emissions in the short term, and is beneficial to mitigate CO 2 emissions in the long term, owing to the gradual optimization of energy consumption structure. However, urbanization helps to reduce CO 2 emissions in the short term, but leads to an increase in CO 2 emissions in the long term, because of urban real estate and infrastructure construction investments as well as vehicle use. Energy efficiency leads to an increase in CO 2 emissions both in the short and long run since the scale effect exceeds the technical effect. Industrial structure produces a positive effect in the short run, but the impact is gradually narrowing in the long run. [ABSTRACT FROM AUTHOR]