Cost-benefit allocation of collaborative carbon emissions reduction considering fairness concerns—A case study of the Yangtze River Delta, China.

As the country with the highest carbon emissions, the main focus of China has become carbon reduction. At present, the governance of carbon reduction is mainly based on the division of administrative regions, which leads to the governance inefficiency and high costs because of spatial spillover and regional mobility of carbon emissions. The need for collaborative governance to promote carbon reduction performance has been recognized. However, because of differences in both costs and benefits between developed and less developed regions, a clear cost and benefit allocation mechanism must be established first. Fairness is very important when all members are to actively participate in collaborative carbon emission reduction efforts. In this paper, one of the regions renowned for collaborative governance—the Yangtze River Delta region—is used as example, and a cost-benefit allocation mechanism is constructed that incorporates members' fairness concerns. The carbon emission efficiency, carbon reduction efforts, and total carbon emission amount are compared under two scenarios: a cost-sharing scenario and a centralized decision-making scenario. The results indicate that, compared with the centralized decision-making scenario, the cost-sharing scenario achieved greater regional carbon reduction efforts, a higher carbon emission efficiency, and more total emissions. Furthermore, under the cost-sharing scenario, in less developed regions, fairness concerns increase carbon emission efficiency and total carbon emissions. The fairness concern in developed regions reduces the profit proportion, while the fairness concern in less developed region increases the profit proportion. The impact of fairness concern on carbon reduction is stronger in developed regions. • Carbon emissions from cost-sharing and centralized decision-making are compared. • Impacts of fairness concerns of local governments are considered. • A rational cost-benefit allocation mechanism is developed. • The centralized decision-making pattern is more efficient. [ABSTRACT FROM AUTHOR]