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The effect of carbon emission trading scheme on energy efficiency: Evidence from China

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  • Tan, Xiujie
  • Liu, Yishuang
  • Dong, Hanmin
  • Zhang, Zhan

Abstract

The COVID-19 pandemic has caused a global economic recession and even changed its development pattern. Improving energy efficiency has become one of the best choices worldwide to achieve green recovery in the post-COVID-19 era. Therefore, this study explores the effect of carbon emission trading scheme (ETS) pilots on energy efficiency by the difference-in-differences (DID) model, using panel data of 30 Chinese provinces from 2009 to 2020. The following results are obtained: (1) Carbon ETS pilots could significantly increase energy efficiency by an overall effect of 1.82%, among which technical efficiency might be improved more obviously than others; (2) The average effect of carbon ETS pilots may differ between provinces because of some economic-regional factors, being more significant in regions with a large number of employees and high wages; (3) This positive effect is transferred through industrial structure and R&D investment.

Suggested Citation

  • Tan, Xiujie & Liu, Yishuang & Dong, Hanmin & Zhang, Zhan, 2022. "The effect of carbon emission trading scheme on energy efficiency: Evidence from China," Economic Analysis and Policy, Elsevier, vol. 75(C), pages 506-517.
    • Handle: RePEc:eee:ecanpo:v:75:y:2022:i:c:p:506-517
    DOI: 10.1016/j.eap.2022.06.012
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