Local government decision-making competition and regional carbon emissions: Experience evidence and emission reduction measures

Abstract

In the new urbanization process, local government decision-making competition (LGC) is the key factor of carbon emissions. In most similar studies, the administrative orders, the strategic development paths, environmental policies, etc. are not considered, and it is difficult to help local governments to formulate precise emission reduction policies. The research logic of this study is “empirical evidence summary, theoretical explanation, and heterogeneity analysis”. First, the relationship between LGC and carbon emissions is explored through data fitting and mathematical modeling based on China’s six major urban agglomerations. Second, the effect mechanism of LGC on carbon emissions is analyzed theoretically by a nonlinear programming model. Third, the heterogeneities of the effect paths at different stages are discussed and targeted emission reduction measures are put forward. The results are: (1) There is a three-stage nonlinear relationship between LGC and carbon emissions, and the turning points are LGC = 0.53 and 0.64. (2) LGC affects carbon emissions through distorting the factor markets, government investment, and the implementation of environmental policies. (3) At the rapidly increasing stage, the carbon intensity of the “enclave economy” is 473$/ton; 84.63-million-yuan increase of fiscal revenue causes1 ton increase of carbon emissions under the land finance; The phenomenon of “race to the bottom” and “free riding” are serious. (4) At the slowly increasing stage, 23-million-yuan increase of debt financing increases 1 ton of carbon emissions; The carbon emission intensity of the “industrial park” economy is $1655/ton; Investment of 28.75 million yuan in technology transfer reduces 1 ton of carbon emissions. (5) At the gradually decreasing stage, 7% increase of total factor productivity could decrease 1 ton of carbon emissions; Investment is biased towards the science, education, culture, health, and business environment optimization; 26.75 million yuan of fiscal investment reduces 1 ton of carbon emissions; There exists “race to the top” in environment governance. Research in this paper could provide a basis for the central and local governments to formulate differentiated and targeted emission reduction policies.