IDEAS home Printed from https://ideas.repec.org/a/eee/ecanpo/v84y2024icp1010-1028.html
   My bibliography  Save this article

Job destruction or job creation?: Evidence from carbon emission trading policies

Author

Listed:
  • Wang, Qiaoru
  • Huang, Hongyu
  • Liu, Tingyu

Abstract

Based on the panel data of 285 cities in China from 2007 to 2019, this paper constructs a theoretical framework to analyze the employment effect of carbon emission trading policy, and quantitatively evaluates the effectiveness, decomposition effect and influence mechanism of carbon emission trading policy on employment based on PSM-DID method. The study shows that the carbon emissions trading policy has a positive impact on the level of urban employment while producing significant environmental governance effects, and that its positive impact on employment in the pilot cities stems from the negative effect of reducing employment destruction rather than from the positive effect of increasing the job-creating effect. Carbon emissions trading policy promotes employment in the pilot cities through structural transformation effects, specifically through the three paths of green technology innovation, energy structure optimization and industrial structure upgrading. At the same time, the impact of the policy on employment varies significantly across cities of different locations, sizes and resource endowments. The study proposes that the construction of the national carbon market should be accelerated, a market-oriented green technology innovation system should be constructed, the optimization of the energy structure and the upgrading of the industrial structure should be promoted, and training in employment skills should be strengthened. The theoretical analysis of this study provides a theoretical basis for the micro-mechanism of carbon emissions trading policy, and the empirical results provide practical reference for the change of employment structure and the high-quality development of employment.

Suggested Citation

  • Wang, Qiaoru & Huang, Hongyu & Liu, Tingyu, 2024. "Job destruction or job creation?: Evidence from carbon emission trading policies," Economic Analysis and Policy, Elsevier, vol. 84(C), pages 1010-1028.
    • Handle: RePEc:eee:ecanpo:v:84:y:2024:i:c:p:1010-1028
    DOI: 10.1016/j.eap.2024.10.017
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0313592624002674
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.eap.2024.10.017?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gray, Wayne B. & Shadbegian, Ronald J. & Wang, Chunbei & Meral, Merve, 2014. "Do EPA regulations affect labor demand? Evidence from the pulp and paper industry," Journal of Environmental Economics and Management, Elsevier, vol. 68(1), pages 188-202.
    2. Berman, Eli & Bui, Linda T. M., 2001. "Environmental regulation and labor demand: evidence from the South Coast Air Basin," Journal of Public Economics, Elsevier, vol. 79(2), pages 265-295, February.
    3. Yu Zheng & Bing Zhang, 2023. "Does china’s national carbon market function well? A perspective on effective market design," Journal of Chinese Governance, Taylor & Francis Journals, vol. 8(4), pages 563-592, October.
    4. Morgenstern, Richard D. & Pizer, William A. & Shih, Jhih-Shyang, 2002. "Jobs Versus the Environment: An Industry-Level Perspective," Journal of Environmental Economics and Management, Elsevier, vol. 43(3), pages 412-436, May.
    5. Raff, Zach & Earnhart, Dietrich, 2019. "The effects of Clean Water Act enforcement on environmental employment," Resource and Energy Economics, Elsevier, vol. 57(C), pages 1-17.
    6. Kahn, Matthew E. & Mansur, Erin T., 2013. "Do local energy prices and regulation affect the geographic concentration of employment?," Journal of Public Economics, Elsevier, vol. 101(C), pages 105-114.
    7. Christoph Böhringer & Klaus Conrad & Andreas Löschel, 2003. "Carbon Taxes and Joint Implementation. An Applied General Equilibrium Analysis for Germany and India," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 24(1), pages 49-76, January.
    8. E. Mark Curtis, 2018. "Who Loses under Cap-and-Trade Programs? The Labor Market Effects of the NOx Budget Trading Program," The Review of Economics and Statistics, MIT Press, vol. 100(1), pages 151-166, March.
    9. W. Reed Walker, 2013. "The Transitional Costs of Sectoral Reallocation: Evidence From the Clean Air Act and the Workforce," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 128(4), pages 1787-1835.
    10. Yamazaki, Akio, 2017. "Jobs and climate policy: Evidence from British Columbia's revenue-neutral carbon tax," Journal of Environmental Economics and Management, Elsevier, vol. 83(C), pages 197-216.
    11. Wenbin Cao & Hui Wang & Huihui Ying, 2017. "The Effect of Environmental Regulation on Employment in Resource-Based Areas of China—An Empirical Research Based on the Mediating Effect Model," IJERPH, MDPI, vol. 14(12), pages 1-11, December.
    12. Liu, Liwei & Chen, Chuxiang & Zhao, Yufei & Zhao, Erdong, 2015. "China׳s carbon-emissions trading: Overview, challenges and future," Renewable and Sustainable Energy Reviews, Elsevier, vol. 49(C), pages 254-266.
    13. Shaofu Du & Yujiao Zhu & Yangguang Zhu & Wenzhi Tang, 2020. "Allocation policy considering firm’s time-varying emission reduction in a cap-and-trade system," Annals of Operations Research, Springer, vol. 290(1), pages 543-565, July.
    14. Liu, Mengdi & Shadbegian, Ronald & Zhang, Bing, 2017. "Does environmental regulation affect labor demand in China? Evidence from the textile printing and dyeing industry," Journal of Environmental Economics and Management, Elsevier, vol. 86(C), pages 277-294.
    15. Zhao, Jun & Jiang, Qingzhe & Dong, Xiucheng & Dong, Kangyin, 2021. "Assessing energy poverty and its effect on CO2 emissions: The case of China," Energy Economics, Elsevier, vol. 97(C).
    16. Zhuohui Yu & Shiping Mao & Qingning Lin, 2022. "Has China’s Carbon Emissions Trading Pilot Policy Improved Agricultural Green Total Factor Productivity?," Agriculture, MDPI, vol. 12(9), pages 1-21, September.
    17. Tang, Chang & Xue, Yan & Wu, Haitao & Irfan, Muhammad & Hao, Yu, 2022. "How does telecommunications infrastructure affect eco-efficiency? Evidence from a quasi-natural experiment in China," Technology in Society, Elsevier, vol. 69(C).
    18. Bingxin Zeng & Jun Xie & Xiaobing Zhang & Yang Yu & Lei Zhu, 2020. "The impacts of emission trading scheme on China’s thermal power industry: A pre-evaluation from the micro level," Energy & Environment, , vol. 31(6), pages 1007-1030, September.
    19. Zhang, Yue-Jun & Wang, Wei, 2021. "How does China's carbon emissions trading (CET) policy affect the investment of CET-covered enterprises?," Energy Economics, Elsevier, vol. 98(C).
    20. Sun, Yanming & Shen, Simiao & Zhou, Chuanyu, 2023. "Does the pilot emissions trading system in China promote innovation? Evidence based on green technology innovation in the energy sector," Energy Economics, Elsevier, vol. 126(C).
    21. He, Feng & Qin, Shuqi & Liu, Yuanyuan & Wu, Ji (George), 2022. "CSR and idiosyncratic risk: Evidence from ESG information disclosure," Finance Research Letters, Elsevier, vol. 49(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hille, Erik & Möbius, Patrick, 2019. "Do energy prices affect employment? Decomposed international evidence," Journal of Environmental Economics and Management, Elsevier, vol. 96(C), pages 1-21.
    2. Jiyu Zhao & Ning Zhang, 2023. "Environmental regulation and labor market: a bibliometric analysis," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(7), pages 6095-6116, July.
    3. Zhang, Guanglai & Zhang, Ning, 2024. "Environmental regulation and worker earnings: Evidence from city-level air quality standards in China," Energy Economics, Elsevier, vol. 138(C).
    4. Marin, Giovanni & Vona, Francesco, 2019. "Climate policies and skill-biased employment dynamics: Evidence from EU countries," Journal of Environmental Economics and Management, Elsevier, vol. 98(C).
    5. Liao, Jiaqi & Zhang, Ning, 2024. "Environmental regulation and manufacturing employment: Evidence from China's Eleventh Five-Year Plan," China Economic Review, Elsevier, vol. 87(C).
    6. Olivier Deschenes, 2018. "Environmental regulations and labor markets," IZA World of Labor, Institute of Labor Economics (IZA), pages 1-22, November.
    7. Liu, Mengdi & Tan, Ruipeng & Zhang, Bing, 2021. "The costs of “blue sky”: Environmental regulation, technology upgrading, and labor demand in China," Journal of Development Economics, Elsevier, vol. 150(C).
    8. repec:hal:spmain:info:hdl:2441/5ahh4t5kfl8nprei89ignlk5nl is not listed on IDEAS
    9. Li, Zhuo & Li, Yuanqi, 2024. "Environmental regulation and employment: Evidence from China's new Environmental Protection Law," Economic Analysis and Policy, Elsevier, vol. 82(C), pages 400-416.
    10. repec:spo:wpmain:info:hdl:2441/5ahh4t5kfl8nprei89ignlk5nl is not listed on IDEAS
    11. Lu, Shuling & Yang, Qijing, 2024. "Price of going green: The employment effects of the environmental protection tax in China," China Economic Review, Elsevier, vol. 87(C).
    12. Lei Wen & Hongbing Li & Xueying Bian, 2024. "Local environmental legislation and employment growth: evidence from Chinese manufacturing firms," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(7), pages 16917-16955, July.
    13. Luo, Ximing & Dong, Cong & Dong, Xiucheng, 2024. "How economic transformation influence the employment of resource-based cities: Evidence from Shanxi Province, China," Resources Policy, Elsevier, vol. 89(C).
    14. Shiyu Bo, 2021. "Environmental Regulations, Political Incentives and Local Economic Activities: Evidence from China," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 83(3), pages 812-835, June.
    15. Wang, Chang’an & Liu, Xiaoqian & Li, Han & Yang, Cunyi, 2023. "Analyzing the impact of low-carbon city pilot policy on enterprises' labor demand: Evidence from China," Energy Economics, Elsevier, vol. 124(C).
    16. Curtis, E. Mark, 2020. "Reevaluating the ozone nonattainment standards: Evidence from the 2004 expansion," Journal of Environmental Economics and Management, Elsevier, vol. 99(C).
    17. Li, Zhe & Lyu, Pinjie & Sun, Jianfei, 2025. "Environmental regulation and equilibrium unemployment in China: Evidence from a multiple-sector search and matching model," China Economic Review, Elsevier, vol. 89(C).
    18. Marin, Giovanni & Vona, Francesco, 2021. "The impact of energy prices on socioeconomic and environmental performance: Evidence from French manufacturing establishments, 1997–2015," European Economic Review, Elsevier, vol. 135(C).
    19. repec:hal:spmain:info:hdl:2441/1jrfjrj6fp8t6q12fv5lra520c is not listed on IDEAS
    20. Ferris, Ann & Garbaccio, Richard & Marten, Alex & Wolverton, Ann, 2017. "The Impacts of Environmental Regulation on the U.S. Economy," National Center for Environmental Economics-NCEE Working Papers 280936, United States Environmental Protection Agency (EPA).
    21. Ann Wolverton & Ronald Shadbegian & Wayne B. Gray, 2022. "The U.S. Manufacturing Sector’s Response to Higher Electricity Prices: Evidence from State-Level Renewable Portfolio Standards," NBER Working Papers 30502, National Bureau of Economic Research, Inc.
    22. repec:spo:wpmain:info:hdl:2441/1jrfjrj6fp8t6q12fv5lra520c is not listed on IDEAS
    23. Wang, Xu & Wen, Ziyu & He, Lingyun & Zheng, Haoyang & Yang, Tengfei & Long, Ruyin, 2024. "The role of imperfect market structure in the employment effect of emissions trading scheme in China: A theoretical extension and empirical investigation," Economic Analysis and Policy, Elsevier, vol. 82(C), pages 920-937.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecanpo:v:84:y:2024:i:c:p:1010-1028. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/economic-analysis-and-policy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.