A comprehensive study on carbon emissions flows and key drivers within China's domestic and global value chains

Abstract

Numerous studies have examined the transfer of carbon emissions in China's trade. However, few papers have established a link between China's domestic value chains (DVCs) and the global value chains (GVCs) to comprehensively trace the flows of carbon emissions within a unified framework. To address this research gap, our paper aims to connect China's DVCs with the GVCs and map the carbon emissions flows of China's eight regions in both domestic and international trade. Using structural decomposition analysis (SDA), it studies the driving factors behind change in carbon emissions transfer (CET). Our findings are as follows: Firstly, in 2018, the total carbon emissions transfer of China's eight regions amounted to 5122.0mt, a significant increase of 31.1 % compared to 2012. Notably, the carbon emissions transfer through intermediate product trade is more than four times that of the final product trade. Secondly, significant variations exist in the sources and destinations under different trade patterns, which have been largely overlooked in the existing literature. Over 70.0 % of carbon emissions resulting from final product trade are directed towards regions outside of Chinese mainland, while approximately two-thirds of carbon emissions resulting from intermediate product trade are allocated to Chinese mainland's internal regions. Thirdly, the reduction of carbon emissions transfer increment is primarily driven by the carbon intensity, while the indirect demand scale effect of Chinese mainland's internal regions emerges as the most significant driving factor, playing a substantial role in the increase of carbon emissions transfer. Additionally, the unreasonable input-output structure between regions within Chinese mainland has contributed to the rise in carbon emissions transfer. The research findings offer valuable insights and policy recommendations for the formulation of regional carbon reduction policies in China.