What factors contribute to the extent of decoupling economic growth and energy carbon emissions in China?

Abstract

Based on the IGT equation, we calculate the decoupling index Dr of China's economic growth and energy CO2 emissions from 1978 to 2020, and analyze the evolution trend of the decoupling development between the two. Then, based on the ARDL model, the factors influencing the decoupling relationship are empirically tested and analyzed. The findings are threefold. (1) In the long term, the decoupling is effectively promoted by the relative energy price index, the increase in the clean energy proportion and the strengthening of government intervention. And the decreases in research and development investment, foreign trade, and the ratio of tertiary to secondary industry elicit the same direction on the decoupling relationship. (2) In the short term, the decline in the current increment of government intervention is the strongest contributor to the decoupling relationship, followed by the rise in the current increment of the ratio of the tertiary to the secondary industry. (3) The combined results of historical decomposition, impulse response, and variance decomposition indicate that clean energy share shocks, research and development intensity shocks, and relative energy price index shocks are the main sources of Dr fluctuations. The results of the study can provide a reference for achieving carbon reduction in China.