Emissions Cost and Value-Added Benefit of Exports in China: An Analysis Based on a Global Input-Output Model

Abstract

Exports contribute significantly to both income creation and pollution generation in China. Using a global input-output model, this paper examines domestic value-added and 8 types of air pollutant emissions generated by export production in China during the period of 1995–2009. The results show that both value-added and emissions created by exports of China increased significantly in the study period. In 2009, the share of value-added exports in Chinese GDP accounted for 32.3%. Meanwhile, emissions embodied in exports accounted 22–35% of total production emissions in China for 8 types of air pollutants. Although pollution intensities of value-added exports (the ratio of emissions to value-added created in the production of exports) in China were continuously declining for all pollutants in the study period, they were much greater than those of other major exporting countries. Based on a structural decomposition analysis, we find that the gaps in pollution intensities of value-added exports between China and other major exporting countries mainly result from differences in direct emissions intensity and input structure of production, whereas differences in export structure generally reduces the gaps in pollution intensities of value-added exports.