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Is the Clean Development Mechanism Effective for Emission Reductions?

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Listed:
  • He, Jingjing
  • Huang, Yongfu
  • Tarp, Finn

Abstract

This research studies whether the Clean Development Mechanism (CDM) of the Kyoto Protocol achieves its objective of emission reductions in the host countries. It empirically investigates the impacts of CDM projects on CO? emission reductions for 60 CDM host countries over 2005-10. This research makes use of the newly-developed econometric methods for dynamic panel data models associated with X-differencing procedure. It provides evidence in support of a decline in CO? emissions in the CDM host countries. It has important policy implications that encourage the international community to support developing countries´ efforts towards low-carbon development via CDM projects.

Suggested Citation

  • He, Jingjing & Huang, Yongfu & Tarp, Finn, 2012. "Is the Clean Development Mechanism Effective for Emission Reductions?," WIDER Working Paper Series 073, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp2012-73
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    References listed on IDEAS

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    1. Huang, Yongfu & Barker, Terry, 2012. "The Clean Development Mechanism and low carbon development: A panel data analysis," Energy Economics, Elsevier, vol. 34(4), pages 1033-1040.
    2. Bruno, Giovanni S.F., 2005. "Approximating the bias of the LSDV estimator for dynamic unbalanced panel data models," Economics Letters, Elsevier, vol. 87(3), pages 361-366, June.
    3. Jinyong Hahn & Guido Kuersteiner, 2002. "Asymptotically Unbiased Inference for a Dynamic Panel Model with Fixed Effects when Both "n" and "T" Are Large," Econometrica, Econometric Society, vol. 70(4), pages 1639-1657, July.
    4. Sheila M. Olmstead & Robert N. Stavins, 2006. "An International Policy Architecture for the Post-Kyoto Era," American Economic Review, American Economic Association, vol. 96(2), pages 35-38, May.
    5. repec:unu:wpaper:wp2012-072 is not listed on IDEAS
    6. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    7. Bun, Maurice J. G. & Kiviet, Jan F., 2003. "On the diminishing returns of higher-order terms in asymptotic expansions of bias," Economics Letters, Elsevier, vol. 79(2), pages 145-152, May.
    8. He, Jingjing & Huang, Yongfu & Tarp, Finn, 2012. "Is the Clean Development Mechanism Promoting Sustainable Development?," WIDER Working Paper Series 072, World Institute for Development Economic Research (UNU-WIDER).
    9. Nickell, Stephen J, 1981. "Biases in Dynamic Models with Fixed Effects," Econometrica, Econometric Society, vol. 49(6), pages 1417-1426, November.
    10. Kiviet, Jan F., 1995. "On bias, inconsistency, and efficiency of various estimators in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 68(1), pages 53-78, July.
    11. Azmat Gani, 2012. "The Relationship Between Good Governance And Carbon Dioxide Emissions: Evidence From Developing Economies," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 37(1), pages 77-93, March.
    12. Emma Paulsson, 2009. "A review of the CDM literature: from fine-tuning to critical scrutiny?," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 9(1), pages 63-80, February.
    13. Anderson, T. W. & Hsiao, Cheng, 1982. "Formulation and estimation of dynamic models using panel data," Journal of Econometrics, Elsevier, vol. 18(1), pages 47-82, January.
    14. repec:reg:rpubli:353 is not listed on IDEAS
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    Cited by:

    1. Marcel Probst & Caspar Sauter, 2015. "CO2 Emissions and Greenhouse Gas Policy Stringency - An Empirical Assessment," IRENE Working Papers 15-03, IRENE Institute of Economic Research.
    2. Purdon, Mark, 2015. "Opening the Black Box of Carbon Finance “Additionality”: The Political Economy of Carbon Finance Effectiveness across Tanzania, Uganda, and Moldova," World Development, Elsevier, vol. 74(C), pages 462-478.
    3. Kasai, Katsuya, 2012. "Factors Affecting the Distribution of CERs: A Cross-Sectional Empirical Analysis," MPRA Paper 52163, University Library of Munich, Germany, revised Jan 2013.
    4. He, Jingjing & Huang, Yongfu & Tarp, Finn, 2012. "Is the Clean Development Mechanism Promoting Sustainable Development?," WIDER Working Paper Series 072, World Institute for Development Economic Research (UNU-WIDER).
    5. repec:unu:wpaper:wp2012-072 is not listed on IDEAS

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    Keywords

    Climatic changes; Econometrics; Environment;

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