The effects of emission trading scheme on industrial output and air pollution emissions under city heterogeneity in China. (15th September 2021)

• Record Type: Journal Article
• Authors: Huang, Jingru; Shen, Jie; Miao, Lu; Zhang, Weikun
• Is Part Of: Journal of cleaner production. Volume 315(2021)
• Publication Date: 2021-09-15
• Subjects: Emission trading scheme -- Regional development heterogeneity -- Policy effects -- PSM-DID method; Factory and trade waste -- Management -- Periodicals; Manufactures -- Environmental aspects -- Periodicals; Déchets industriels -- Gestion -- Périodiques; Usines -- Aspect de l'environnement -- Périodiques; 628.5
• DOI: 10.1016/j.jclepro.2021.128260
• Languages: English
• ISSNs: 0959-6526

Abstract

Abstract: Ecological degradation has become one of the constraints on the development of human society. To deal with pollutant emissions, governments around the world have implemented emission trading schemes (ETS). However, although the effectiveness of ETS policies has been widely acknowledged, it is unclear whether the policy effects depend on regional characteristics. To address this research gap, this study integrated the propensity score matching method and multi-period difference-in-difference model (PSM-DID) to examine the impacts of ETS on industrial output and pollution emissions, and the influence of city heterogeneity on policy effects. The results showed that the ETS positively affected industrial output and negatively affected pollutant emissions in the pilot cities. Furthermore, implementation of the ETS was more conducive to increasing industrial output while reducing emissions in cities with larger populations, higher financial development levels, and worse air quality. Nevertheless, in lower industrialized cities, the ETS implementation was more prominent in promoting industrial output. In this case, the environmental effect was lower than that in cities with higher industrialized. The findings provide a better understanding of city heterogeneity of ETS policy effects. Highlights: Population, financial and pollution level influences positively emission trading scheme effects. Chinese emission trading scheme produce better economic benefits in less industrialized cities. The Propensity Score Matching method and multi-periods Difference-in-Difference model were used.