Role of environmental technologies and mitigation strategies in environmental performance: Case of Chinese economy

Abstract

There has been an acceleration in global warming and other environmental issues due to industrialization, high population growth and other socio-economic factors in China. Besides, electricity volume generated through non-renewable resources directly contribute majorly in environmental pollution. The present study, therefore, aims to analyse economy-wide implications of factors such as electricity production from wind and solar sources, and mitigation strategies, such as carbon taxes and carbon finance, on environmental performance in China. The article uses population growth and industrialization as control variables to predict environmental performance. The study employs the dynamic auto-regressive distributed lag (DARDL) and nonlinear autoregressive distributed lag (NARDL) models to determine the nexus among the variables. The outcomes indicate that electricity production from wind and solar sources, carbon taxes, carbon finance, population growth, and industrialization have positive links to environmental performance and negative links to greenhouse gas (GHG) emissions in China. This implies that as an emerging renewable pioneer, China is advised to have less reliance on coal-based resources in electricity grid and expand its interest in renewable resource through the help of environmental technologies.