Abstract
In response to global warming, greenhouse gas (GHG) abatement has been one of the top priorities of governments, and a large variety of environmental regulation policies have been implemented in past decades. Using panel data from 27 OECD countries over the period of 2005–2012, this study measures and compares the stringency level of command-and-control and market-based environmental regulations. The differentiated impacts and indirect effects of environmental regulations on GHG emissions are tested empirically. The results show that: (1) Both command-and-control and market-based environmental regulations have effects on GHG abatement in OECD countries, and there is a non-linear relationship between environmental regulations and GHG discharge, in which stringent command-and-control environmental regulations and mild market-based regulation policies are preferred; (2) Command-and-control environmental regulations reduce GHG emissions by improving the technological level, rather than the energy consumption structure. In contrast, market-based environmental regulations can promote GHG abatement through the intermediary effects of both technological progress and the energy consumption structure. The findings provide implications for OECD countries to further reduce GHG emissions.
Highlights
A continuously increasing amount of greenhouse gases (GHG) has been emitted due to the development of global industrialization, resulting in a global crisis of climate change.Based on the consensus of the risks of global warming, GHG abatement has been one of the top priorities of worldwide governments
The results revealed that command-and-control environmental regulations primarily promoted GHG abatement through improving technological progress, rather than the energy consumption structure, whereas market-based environmental regulations could reduce GHG emissions through the intermediary effects of both technological progress and the energy consumption structure
Research is still insufficient on the role in green growth over the past few decades
Summary
A continuously increasing amount of greenhouse gases (GHG) has been emitted due to the development of global industrialization, resulting in a global crisis of climate change.Based on the consensus of the risks of global warming, GHG abatement has been one of the top priorities of worldwide governments. Paris Agreement in 2015, considerable efforts have been made via international climate negotiations to reduce carbon emissions and combat climate change. Governments have carried out various environmental regulation policies to achieve GHG emissions reduction targets. Depending on the regulation mechanisms and constraints, environmental regulation policies are generally divided into two types: command-andcontrol environmental regulations and market-based environmental regulations [1,2,3,4]. Are both types of environmental regulations effective in reducing GHG, and what are the specific indirect effects through which each type of environmental regulation affects
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