Virtual Carbon Flow in China’s Capital Economic Circle: A Multi-Regional Input–Output Approach

Abstract

The Capital Economic Circle (CEC) is the area with the largest economic aggregate in northern China and has a strong status in driving the economic development of China. However, the industrial structure dominated by high energy consuming industries leads to a large number of carbon dioxide emissions, and the imbalance between economic development and carbon emissions in CEC is serious; therefore, it is necessary to explore how to solve the carbon imbalance problem of the CEC by relying on interregional cooperation. Based on China’s multi-regional input–output tables of 2012, 2015 and 2017, this paper proposes the CEC carbon-extended, multi-regional input–output model to measure virtual carbon flow and analyze how the industrial structure leads to the imbalance of carbon flow distribution in CEC. Indicators such as direct carbon emission coefficients, complete carbon emission coefficients and carbon emissions pull coefficients of the industrial sectors in CEC are calculated and the physical carbon emission and virtual carbon flows among the industrial sectors and the regions are evaluated. The results show that there are potential constraints from the uncoordinated configuration of industrial innovation chains among the CEC, and the “carbon imbalance” of CEC is mainly reflected in the backward production technology of Hebei and its inefficient connection with the industrial innovation chain of Beijing and Tianjin. It is suggested that policymakers should promote the low-carbon production system and strengthen green energy development and utilization to enhance green development in CEC. In future research, we should pay attention to the updating method of the input–output table and the development of carbon circular networks. This study has implications for some areas of China and developing countries in Asia, which also have an imbalance between industrial economy development and carbon emissions, and a similarity in space structure and industry layout with CEC.