Can China’s transfer payment in key ecological function areas reduce the carbon intensity? – Quasi – Natural experimental evidence from Jiangxi, China

Abstract

Reducing carbon intensity while sustaining economic growth is a major challenge for China's ecological civilization construction in the context of global warming. China’s transfer payment policy in National Key Ecological Function areas plays a crucial role in promoting ecological improvement and reducing local carbon intensity. In this study, we examine the impact of transfer payment policies on carbon intensity in Jiangxi Province, a demonstration area for national ecological civilization, and we further investigate the carbon reduction mechanism and the spatial spillover effect of the policies. Results show the following: (1) the transfer payment policy in key ecological function areas has significantly reduced the carbon intensity, and the research conclusion is still valid after the robustness test; (2) the transfer payment policy in key ecological function areas reduces the carbon intensity by promoting the upgrading of industrial structure; (3) the transfer payment policy in key ecological function areas has a significant role in promoting the reduction of carbon intensity in this region and the adjacent regions. The findings highlight the significant promoting role of transfer payment policies in key ecological function zones on carbon emission reduction in both local and neighboring areas. It also underscores the importance of expanding policy coverage, establishing horizontal ecological compensation mechanisms, exploring multidimensional approaches to carbon reduction, and fostering cross-regional exchanges and cooperation. These insights provide valuable guidance for policymakers working towards effective and sustainable carbon emission reduction.