Abstract
A carbon emission trading system (ETS) is an effective market mechanism for promoting the reduction of global greenhouse gas emissions and achieving sustainable development between the economy and the environment. To analyze the emissions reduction effect and economic effect of China’s ETS and further discuss the mechanisms of economic development differences and industrial development differences on the final effect of the policy, this study adopts the propensity score matching-difference in differences method and triple difference method. The empirical results show the following: (1) The ETS can simultaneously achieve both the emissions reduction effect and economic effect when key control variables are included. (2) The population, carbon emissions intensity and per capita GDP have significant positive impacts on carbon emissions; the environmental pollution control intensity, research structure, and research intensity have negative impacts on carbon emissions; and the capita stock, employment, and energy consumption have significant positive economic effects. (3) The ETS has a stronger inhibitory effect on the provinces with higher levels of economic and service development compared to the provinces with lower levels of economic and service development. In contrast, the policy has a weaker inhibitory effect on provinces with higher levels of industrial and construction development compared with the lower level provinces.
Highlights
Greenhouse gas emissions will aggravate the environmental negative externalities on global economic development and restrict the sustainable development of human society
By introducing the PSM model, a random allocation can be achieved by checking the systematic differences between the samples before and after matching, eliminating the endogeneity problems that may exist in the model and ensuring the effectiveness of the propensity score matching difference in differences (PSM-difference in differences (DID)) model [39]
Based on the DID model in and Equations (1) and (2), we evaluate the effects of the emission trading system (ETS) pilot policy on carbon emissions and GDP
Summary
Greenhouse gas emissions will aggravate the environmental negative externalities on global economic development and restrict the sustainable development of human society. A carbon emission trading system (EST) is a powerful channel for emission reduction and alleviating global warming [1]. With the completion of relevant agreements and the construction of ETS systems in the major economies of the world, the trading volume in 2020 is expected to approach 3.5 trillion. Following the “Kyoto Protocol” and the “United Nations Framework Convention on Climate Change,” the European Union fully launched its ETS in 2005, which was the first ETS in the world and is the international ETS with the most successful operations and widest coverage [2].
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