Strategies for Emission Reduction in Construction: The Role of China’s Carbon Trading Market

Amidst global population growth and increased resource consumption, carbon emissions from the construction sector pose a significant environmental challenge. In its commitment to sustainable construction and green development, China has set ambitious targets for “carbon peak and carbon neutrality.” This study pioneers a configurational analysis to decode the intricate dynamics within China’s carbon trading market, focusing on its capacity to diminish CO2 emissions. Utilizing a blend of necessary condition analysis (NCA) and fuzzy-set qualitative comparative analysis (fsQCA), we unravel the causal intricacies and pinpoint critical factors dictating emission reductions. Our research delineates three distinct emission reduction pathways: the efficient compliance-policy guidance path, highlighting the synergy of strict compliance regulations with clear policy directions; the efficient compliance-increasing activity path, emphasizing the dual importance of high compliance rates alongside a vibrant trading market; and the policy guidance-increasing activity synergy path, revealing a synergistic effect between stringent policy guidance and an expanding market. Among these, the market’s compliance rate emerges as paramount, underscoring its pivotal role in emission mitigation. The findings offer a nuanced understanding of China’s carbon market mechanics, presenting actionable insights for policymakers to enhance market efficacy and achieve substantial emission cuts. By spotlighting the multi-faceted strategies crucial for emission reduction, this study enriches the dialogue on carbon markets, contributing significantly to the knowledge economy discourse on leveraging policy and market dynamics for environmental sustainability and innovation.