The carbon characteristics of digital economy: a case study in China

The digital economy is an important area for global economic development, and its carbon emission characteristics are in the spotlight. This study presents an input-output (I-O) framework to comprehensively analyse the carbon characteristics of China’s digital economy, including the overall trends and carbon intensity, the carbon linkages of digital sectors, as well as the impact of industrial digitalization on carbon efficiency. The results show that, although the consumption-based emissions of digital sectors and the emissions attributed to digitalization in non-digital sectors are increasing due to scale expansion, the decreasing trend of carbon intensity in digital sectors and the carbon efficiency improvements resulting from industrial digitalization in non-digital sectors suggest China’s digital economy is environmentally friendly. Given that carbon emissions transferred from non-digital sectors through industrial linkages account for a substantial portion of consumption-based emissions in the digital sectors, and the substitution and manufacturing effects brought by digitalization in non-digital sectors reduce sectoral carbon intensity, the policy implication is that the digital economy in China could play a crucial role in decoupling economic growth and carbon emissions through digital transformation in non-digital sectors as well as clean energy transition by artificial intelligence and smart grids.