The asymmetric impact of the new normal on China's carbon intensity: Reducing government investment carbon intensity but not citizen consumption carbon intensity

Abstract

The new normal is a revolutionary change in China's economic development model. This work is aimed to explore the impact of the new normal on carbon intensity in China from the new perspective of carbon emission intensity of government investment and the carbon emission intensity of citizen consumption. To this end, a new two-layer structural decomposition model was developed based on multi-regional input-output model and structural decomposition analysis. The results show China's carbon intensity of government investment decreased by 27.4%, while the carbon intensity of citizen consumption remained barely changed after entering the new normal phase. This means the new normal has a significant effect on carbon intensity of government investment, but not on carbon intensity of citizen consumption. This finding corresponds to changes in the impact of investment structure on total carbon intensity before and after the new normal. Before the new normal, total carbon intensity was driven up by investment structure. The investment structure drove a 2.5% increase in carbon intensity between 2012 and 2015. However, after the new normal, the total carbon emission intensity was offset by investment structure. Investment structure affects carbon intensity change by −5.5% from 2015 to 2017. In addition, the decline in carbon emissions is uneven across regions. This is, carbon intensity of Inner Mongolia, Yunnan and Xinjiang have not decreased but increased, although the carbon intensity of most provinces has decreased after the new normal.