Carbon Emission Trading Scheme Research Articles

Navigating the Carbon Challenge: Strategic Integration of Hybrid Policies in Green Supply Chains

In the context of climate change, the increasing urgency to mitigate environmental impacts has driven firms to adopt green supply chain strategies. Existing research primarily focuses on either carbon tax or emission trading schemes, leaving a gap in understanding the combined impact of hybrid carbon policies. This study addresses this gap by developing a dual-tier supply chain model with a manufacturer and retailer, exploring the effects of a carbon tax, emission trading, and a hybrid policy on emission reduction strategies and pricing decisions. Using a reverse inductive method within a Stackelberg game framework, we identify optimal strategies for emission reduction and profit maximization under each policy scenario. Results indicate that the hybrid policy achieves the lowest unit carbon emissions when the manufacturer’s initial pollution level is below a critical threshold. This research contributes to the literature by providing actionable insights into the strategic advantages of hybrid carbon policies for firms seeking both profitability and sustainability in green supply chains.

Carbon emission trading scheme and green investor entry: Evidence from China

Carbon emission trading scheme and green investor entry: Evidence from China

The impact of carbon emission trading scheme policy on information asymmetry in the stock market: Evidence from China

The impact of carbon emission trading scheme policy on information asymmetry in the stock market: Evidence from China

Carbon emission trading scheme and university technology transfer: does innovation quantity or quality matter?

Carbon emission trading scheme and university technology transfer: does innovation quantity or quality matter?

Analyzing the carbon pricing-leakage nexus through structural gravity estimation

Carbon emissions drive climate change, and failure to reduce these emissions could lead to disastrous consequences. Countries impose carbon pricing as an instrument to reduce carbon emissions. However, carbon leakage is a counteractive mechanism where countries with higher carbon emission prices may see their sectors outsource production to countries with lower prices or lose competitiveness and market share to foreign companies with lower production costs. This study confirms that fuel excise taxes are the leading channel of carbon leakage. Structural gravity estimates show that carbon pricing based on carbon taxes and emission trading schemes (ETS) does not cause carbon leakage, but fuel excise taxes and ETS exemptions have a significant impact. This finding is supported when looking at carbon prices in different sectors. Thus, policymakers should consider adjusting fuel excise taxes accordingly.

Does China’s carbon emission trading scheme reduce CO[formula omitted] emissions? Comprehensive evaluation from synthetic control method using lasso

Does China’s carbon emission trading scheme reduce CO[formula omitted] emissions? Comprehensive evaluation from synthetic control method using lasso

Analyzing the Effectiveness of Carbon Pricing Instruments in Reducing Carbon Emissions in Major Asian Economies

Carbon Pricing Instruments (CPIs), such as Carbon Taxes and Emission Trading Schemes (ETSs), have been launched in several countries, primarily in Europe and North America, as a means of limiting the emissions of greenhouse gases (GHGs) which have been known to cause climate change. The adoption of these measures in Asia has been controversial, with many arguing that they would limit economic development in the region. We review the CPIs of 18 Asian economies, 7 of which have adopted a CPI during our review period from 1990 to 2021. We perform a comparative analysis of the economies in Asia, applying the Kaya Identity to decompose the variables affecting carbon emissions and the Nearest Neighbor Matching technique to compare the effect that CPIs have on countries adopting these policies relative to other jurisdictions. We found a positive and significant effect of CPIs on reducing carbon emissions in the Asian countries compared in our study. This offers crucial insights for policymakers, stressing the effectiveness of CPIs in balancing environmental sustainability with economic development in the region.

Has the carbon emission trading scheme induced investment leakage in China? Firm-level evidence from China's stock market

Has the carbon emission trading scheme induced investment leakage in China? Firm-level evidence from China's stock market

Carbon emission trading scheme, investors’ attention, and earnings response coefficients

Carbon emission trading scheme, investors’ attention, and earnings response coefficients

The Impact of Carbon-Emission Trading Scheme Policies on Air Quality in Chinese Cities

Air quality issues have a significant impact on human health and are an important issue affecting sustainable development. With the implementation of China’s carbon-emission trading scheme, carbon emissions have been effectively reduced, which has a potential impact on air quality. This article uses a time-point difference-in-differences model to analyze the impact of the implementation of a carbon-emission trading scheme on the air quality in 284 cities in China from 2008 to 2021. During the inspection, the impact of policies on overall air quality and on various types of air pollutants was discussed separately. The research results show that the implementation of the carbon-emission trading scheme helps improve urban air quality issues, reduce the concentration of air pollutants such as PM2.5 and SO2, and improve the urban environment; with controlled variables, it has reduced PM2.5 by 2.548 units, SO2 by 0.180 units, NOx by 0.295 units, and has promoted the sustainable development of cities. In addition, the policy mainly has a positive impact on air quality by promoting green technology innovation and industrial upgrading, further demonstrating the spillover effect of the policy. There is also some regional heterogeneity in the policies, especially in the central and western regions, where the reduction effect of SO2 and nitrogen oxides is not significant.

Does the Carbon Emission Trading Scheme Truly Enhance Green Innovation Efficiency? From the Perspective of Market Mechanism and Government Intervention

Does the Carbon Emission Trading Scheme Truly Enhance Green Innovation Efficiency? From the Perspective of Market Mechanism and Government Intervention

Carbon emission trading scheme and air quality improvement: evidence from quasi-natural experiment in pilot cities in China

Carbon emission trading scheme and air quality improvement: evidence from quasi-natural experiment in pilot cities in China

Research on the Impact Mechanism of ETS on Green Innovation in China’s High-Carbon Industries: A Perspective of Enterprise Heterogeneity

Green technology innovation is an important driving force for low-carbon development of enterprises. As a market-based environmental policy to promote greenhouse gas emission reduction, whether carbon emission trading scheme (ETS) can encourage enterprises to carry out green technology innovation under the background of “dual carbon” goal deserves further research. Taking Chinese A-share listed enterprises in the five major sectors as samples, this study constructed a modified Difference-in-Differences (DID) model to test the causal effect of ETS on green innovation in high-carbon industries. Three significant results can be summarized from the empirical study. Firstly, the ETS has a significant promoting effect on green innovation of high-carbon enterprises. And it can effectively promote high-carbon enterprises to achieve an average of a 13.24–19.56% increase in low-carbon innovation capabilities. Secondly, enterprises with different characteristics have heterogeneity in the impact of ETS implementation on green innovation. Secondly, the implementation of ETS exerts heterogeneous effects on green technology innovation across enterprises that possess diverse characteristics. Enterprises with a large capital scale (low equity concentration) have a more significant promoting effect than those with a small capital scale (high equity concentration). Thirdly, the green innovation effect of ETS exhibits significant heterogeneity across different types of industries. In the mining, manufacturing, and construction sectors, the ETS has effectively stimulated green innovation to a certain extent. There has been no significant change in green innovation in the sector of electricity, heat, gas, and water production and supply. In particular, after the implementation of the ETS, green innovation has actually been weakened in the transportation sector. As such, for policy makers, differentiated ETS policies should be implemented based on the actual situation of different industries and types of carbon-emitting enterprises.

A Nonlinear Analysis of Carbon Pricing Mechanisms: Comparing the Economic Impacts of Carbon Tax and Emissions Trading Schemes in Developing Economies

This study evaluates the relative effectiveness of Carbon Tax and Emission Trading Schemes (ETS), for developing economies, in promoting economic growth as well as emission reductions. A systematic literature review (SLR) analyzing 36 studies is employed for this purpose. Findings reveal that Carbon Tax brings temporary economic deceleration but fuels long-term sustainability with clearer direct impacts. ETS also achieves the same objectives with greater flexibility thereby offsetting the negative impacts of Carbon Pricing via price volatility. Revenue recycling is a key tool to address economic disbenefits. This study sheds an urgent light on the imperatives for region-specific policy designs and forthcoming hybrid mechanisms as well as longitudinal socioeconomic effect investigation among underrepresented developing regions.

The Synergistic Effect of the Carbon Emission Trading Scheme on Pollution and Carbon Reduction in China’s Power Industry

The synergistic effect of pollution and carbon reduction can alleviate the dual pressure of improving environmental quality and reducing greenhouse gas emissions in China. The carbon emission trading scheme (CETS) is a crucial market-based tool for carbon emission reduction, and understanding its synergistic impact on air pollution control is essential. Based on data from 30 provincial panels in China spanning from 2007 to 2021, we employ the difference-in-differences (DID) method to analyze the synergistic effects of the carbon emission trading plan in the power industry and its influence mechanisms are examined. We observe that the CETS significantly enhances both pollution and carbon reduction in China’s power sector, particularly demonstrating effective synergy in reducing CO2, SO2, and PM2.5 emissions. Furthermore, mechanism analysis reveals that the CETS achieves joint emission reductions by lowering energy consumption, influencing the power industry’s generation structure, promoting technological innovation among enterprises, and thereby realizing synergistic pollution and carbon reduction effects in China’s power sector. Heterogeneity analysis shows that regions with limited power facility, low electricity generation, and small economic scale exhibit the most pronounced synergistic benefits from pollution and carbon reduction efforts.

Strategic investments and portfolio management in interdependent low-carbon electricity and natural gas markets

Strategic investments and portfolio management in interdependent low-carbon electricity and natural gas markets

Evolutionary Game Analysis of Collaborative Prefabricated Buildings Development Behavior in China under Carbon Emissions Trading Schemes

Prefabricated buildings (PBs) are considered a green way to reduce energy consumption and carbon emissions in the construction industry due to their environmental and social benefits. However, PBs have obstacles such as high construction costs, immature technology, and insufficient policy incentives, and developers’ willingness to develop them needs to be higher. Therefore, it is necessary to explore how to motivate more developers to develop PBs. In this paper, we first discuss the impact of the carbon emissions trading scheme (ETS) on the construction industry and then consider the heterogeneity of construction developers, introduce a collaborative mechanism to establish a three-party evolutionary game model between the government and the heterogeneous developers, and explore the evolution of the three-party dynamic strategies through numerical simulation. The results show that developers’ initial development probability affects the system’s evolutionary trend, and the developer who obtains more low-carbon benefits plays a dominant role. Further analyses show that critical factors such as market profitability, synergistic benefits, and carbon tax price positively influence the development of PBs, and the influence of synergistic cooperation mechanisms should be especially emphasized. This study provides practical insights into the sustainable development of the construction industry and the government’s development of a suitable carbon portfolio policy for it. Including the construction industry in the ETS is recommended when carbon prices reach 110 RMB/t. At this point, the government can remove the subsidy for PBs, but the behaviors of the developers who participate in the ETS still need to be supervised.

Climate transition risk and enterprise default probability

AbstractPreventing and controlling the risk of enterprise default is an important way to maintain financial stability. When mitigating and adapting to climate change, it is important to study whether climate transition risk affects the probability of enterprise default. This article systematically analyzes data for Chinese‐listed companies from 2000 to 2019 and finds that climate transition risk significantly increases enterprise default probability (EDF). In addition, pilot carbon emission trading schemes and national carbon emission trading increase this effect. Financing constraints and profitability act as transmission channels; the transmission path, in turn, is influenced by the enterprise environment, social, and governance (ESG) factors and executive compensation. Excellent enterprise ESG performance can lower the positive impact of climate transition risk on EDF. However, higher executive compensation has the opposite effect: high compensation is associated with higher risk. When considering different business types, climate transition risk is more likely to increase the default probability of small assets or non‐state‐owned enterprises. This study helps describe the internal relationship between climate transition risk and EDF, and provides insights to better prevent and address the problem of enterprise debt default caused by climate transition risk.

Carbon emission trading scheme and carbon performance: The role of carbon management system

Carbon emission trading scheme and carbon performance: The role of carbon management system

Does carbon emission trading scheme inhibit corporate executives' pursuit of excess compensation? Evidence from a quasi-natural experiment in China

Does carbon emission trading scheme inhibit corporate executives' pursuit of excess compensation? Evidence from a quasi-natural experiment in China