The effect of directed technical change on carbon dioxide emissions: evidence from China's industrial sector at the provincial level.

Technical change has a pivotal role to play in low-carbon development. Recent research has offered different insights regarding the effect of technical change on CO₂ emissions but ignored the bias of technical changes which lead to changes in CO₂ emissions. To fill the gap, this paper uses the 2008 to 2015 provincial-level data on China's 22 industrial sub-sectors to investigate both the effect of directed technical change on CO₂ emissions and its heterogeneity. We find that the technical change in most industrial sectors in China was capital-biased, although a labor-biased trend was evident. Labor-biased technical change is conducive to CO₂ reduction, while capital-biased technical change has the opposite effect. Moreover, this effect is different by developmental periods, industries, and regions. Therefore, we propose that the government promotes labor-biased technical change based on the differentiated characteristics. [ABSTRACT FROM AUTHOR]