Hostname: page-component-78c5997874-4rdpn Total loading time: 0 Render date: 2024-11-05T10:01:28.668Z Has data issue: false hasContentIssue false
  • English
  • Français

When does the turning point in China's CO2 emissions occur? Results based on the Green Solow model

Published online by Cambridge University Press:  06 February 2015

Yu Hao  and
Yi-Ming Wei
Yu Hao
Affiliation:
Center for Energy and Environmental Policy Research, Beijing Institute of Technology; and School of Management and Economics, Beijing Institute of Technology, Beijing, China. E-mail: [email protected]
Yi-Ming Wei
Affiliation:
Center for Energy and Environmental Policy Research, Beijing Institute of Technology, 5 South Zhongguanccun Street, Haidian District, Beijing 100081, China; and School of Management and Economics, Beijing Institute of Technology, Beijing, China. Tel/Fax: 86-10-68911706. E-mail: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

In recent years, the surge in China's CO2 emissions has caused increasing international concern. In this paper, we investigate whether and when the turning point in China's CO2 emissions would occur. A simple yet powerful neoclassical Green Solow model (GSM) is utilized herein as the main forecasting tool. To verify the capability of this framework to address China's economy, a key prediction of the GSM – the convergence in per capita CO2 emissions across Chinese provinces – is empirically verified. By assigning reasonable values to the GSM's key parameters, the trajectories of total CO2 emissions are projected for the three regions of China and the whole country. The forecast results show that, under the benchmark scenario, China's total CO2 emissions would peak around the year 2047. According to the sensitivity analysis, carbon efficiency is the most important determining factor for whether a turning point in total CO2 emissions may occur.

Type
Research Article
Information
Environment and Development Economics , Volume 20 , Issue 6 , December 2015 , pp. 723 - 745
Copyright
Copyright © Cambridge University Press 2015 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Agras, J. and Chapman, D. (1999), ‘A dynamic approach to the environmental Kuznets curve hypothesis’, Ecological Economics 28(2): 267–277.Google Scholar
Altras, P. (2004), ‘Is the U.S. aggregate production function Cobb–Douglas? New estimates of the elasticity of substitution’, Contributions to Macroeconomics 4(1): 1–34.Google Scholar
Andreoni, J. and Levinson, A. (2001), ‘The simple analytics of the environmental Kuznets curve’, Journal of Public Economics 80(2): 269–286.Google Scholar
Arellano, M. and Bover, O. (1995), ‘Another look at the instrumental variable estimation of error-components models’, Journal of Econometrics 68(1): 29–51.Google Scholar
Auffhammer, M. and Carson, R.T. (2008), ‘Forecasting the path of China's CO2 emissions using province-level information’, Journal of Environmental Economics and Management 55(3): 229–247.Google Scholar
Azomahou, T., Laisney, F., and Nguyen Van, P. (2006), ‘Economic development and CO2 emissions: a nonparametric panel approach’, Journal of Public Economics 90(6): 1347–1363.CrossRefGoogle Scholar
Blundell, R. and Bond, S. (1998), ‘Initial conditions and moment restrictions in dynamic panel data models’, Journal of Econometrics 87(1): 115–143.Google Scholar
Bond, S., Hoeffler, A., and Temple, J. (2001), ‘GMM estimation of empirical growth models’, CEPR Discussion Paper No. 3048, Centre for Economic Policy Research, London.Google Scholar
Brock, W.A. and Taylor, M.S. (2005), ‘Economic growth and the environment: a review of theory and empirics’, in Aghion, P. and Durlauf, S. (eds), Handbook of Economic Growth, Vol. 1B, Amsterdam: North-Holland Press, pp. 1749–1821.Google Scholar
Brock, W.A. and Taylor, M.S. (2010), ‘The Green Solow model’, Journal of Economic Growth 15(2): 127–153.Google Scholar
Cao, J. (2007), ‘The aggregate production function and contribution rate of technical change to economic growth in China’, Journal of Quantitative & Technical Economics 11: 37–46 [in Chinese].Google Scholar
Chang, C.P. and Lee, C.C. (2008), ‘Are per capita carbon dioxide emissions converging among industrialized countries? New time series evidence with structural breaks’, Environment and Development Economics 13(4): 497–515.Google Scholar
Chow, G. and Lin, A.L. (2002), ‘Accounting for economic growth in Taiwan and Mainland China: a comparative analysis’, Journal of Comparative Economics 30(3): 507–530.Google Scholar
Cole, M.A., Rayner, A.J., and Bates, J.M. (1997), ‘The environmental Kuznets curve: an empirical analysis’, Environment and Development Economics 2(4): 401–416.Google Scholar
Dinda, S. (2004), ‘Environmental Kuznets curve hypothesis: a survey’, Ecological Economics 49(4): 431–455.Google Scholar
Ding, S. and Knight, J. (2009), ‘Can the augmented Solow model explain China's remarkable economic growth? A cross-country panel data analysis’, Journal of Comparative Economics 37(3): 432–452.Google Scholar
Duarte, R., Pinilla, V., and Serrano, A. (2013), ‘Is there an environmental Kuznets curve for water use? A panel smooth transition regression approach’, Economic Modelling 31: 518–527.Google Scholar
Duffy, J. and Papageorgiou, C. (2000), ‘A cross-country empirical investigation of the aggregate production function specification’, Journal of Economic Growth 5(1): 87–120.Google Scholar
Fouquau, J., Destais, G., and Hurlin, C. (2009), ‘Energy demand models: a threshold panel specification of the “Kuznets curve”’, Applied Economics Letters 16(12): 1241–1244.Google Scholar
Galeotti, M. and Lanza, A. (2005), ‘Desperately seeking Environmental Kuznets’, Environmental Modelling & Software 20(11): 1379–1388.Google Scholar
Galeotti, M., Lanza, A., and Pauli, F. (2006), ‘Reassessing the environmental Kuznets curve for CO2 emissions: a robustness exercise’, Ecological Economics 57(1): 152–163.Google Scholar
Grossman, G.M. and Kruger, A.B. (1991), ‘Environmental impacts of a North American Free Trade Agreement’, NBER Working Paper No. 3914, National Bureau of Economic Research, Boston, MA.Google Scholar
Guo, Q. and Jia, J. (2004), ‘Estimating potential output and the output gap in China’, Economic Research Journal 5: 31–39 [in Chinese].Google Scholar
He, J. and Richard, P. (2009), ‘Environmental Kuznets curve for CO2 in Canada’, Ecological Economics 11(3): 1–11.Google Scholar
He, J. and Wang, H. (2012), ‘Economic structure, development policy and environmental quality: an empirical analysis of environmental Kuznets curves with Chinese municipal data’, Ecological Economics 76: 49–59.Google Scholar
He, D., Zhang, W., and Shek, J. (2007), ‘How efficient has been China's investment? Empirical evidence from national and provincial data’, Pacific Economic Review 12(5): 597–617.Google Scholar
Holtz-Eakin, D. and Selden, T.M. (1995), ‘Stoking the fires? CO2 emissions and economic growth’, Journal of Public Economics 57(1): 85–101.Google Scholar
IPCC (International Panel on Climate Change) (2006), 2006 IPCC Guidelines for National Greenhouse Gas Inventories, Kanagawa: Institute for Global Environmental Strategies (IGES) for the IPCC.Google Scholar
Itkonen, J.V. (2012), ‘Problems estimating the carbon Kuznets curve’, Energy 39(1): 274–280.Google Scholar
Jobert, T., Karanfil, F., and Tykhonenko, A. (2010), ‘Convergence of per capita carbon dioxide emissions in the EU: legend or reality?’, Energy Economics 32(6): 1364–1373.Google Scholar
Jobert, T., Karanfil, F., and Tykhonenko, A. (2014), ‘Estimating country-specific environmental Kuznets curves from panel data: a Bayesian shrinkage approach’, Applied Economics 46(13): 1449–1464.Google Scholar
Kong, X., Marks, R.E., and Wan, G.H. (1999), ‘Technical efficiency, technological change and total factor productivity growth in Chinese state-owned enterprises in the early 1990s’, Asian Economic Journal 13(3): 267–281.Google Scholar
Leggett, J.A. (2012), ‘China's greenhouse gas emissions and mitigation policies’, Environmental Research Journal 6(6): 451–472.Google Scholar
Li, B. and Zeng, Z. (2009), ‘Recalculating the changes in China's total factor productivity’, Journal of Quantitative & Technical Economics 3: 3–15 [in Chinese].Google Scholar
Liu, Y., Kuang, Y., Huang, N., Wu, Z., and Wang, C. (2009), ‘CO2 emission from cement manufacturing and its driving forces in China’, International Journal of Environment and Pollution 37(4): 369–382.Google Scholar
Mankiw, N.G., Romer, D., and Weil, D.N. (1992), ‘A contribution to the empirics of economic growth’, Quarterly Journal of Economics 107(2): 407–437.Google Scholar
Moomaw, W.R. and Unruh, G.C. (1997), ‘Are environmental Kuznets curves misleading us? The case of CO2 emissions’, Environment and Development Economics 2(4): 451–463.Google Scholar
Nandi, J. (2013), ‘China represents 68% of increase in global CO2 emissions, India 8%: study’, The Times of India, 15 April, [Available at] http://timesofindia.indiatimes.com/home/environment/pollution/China-represents-68-of-increase-in-global-CO2-emissions-India-represents-8-Study/articleshow/19566100.cms.Google Scholar
Nguyen-Van, P. (2010), ‘Energy consumption and income: a semiparametric panel data analysis’, Energy Economics 32(3): 557–563.Google Scholar
Ordás Criado, C., Valente, S., and Stengos, T. (2011), ‘Growth and pollution convergence: theory and evidence’, Journal of Environmental Economics and Management 62(2): 199–214.Google Scholar
Peng, G.H. (2005), ‘The disparity of income, TFP and the convergence hypothesis in Chinese provinces’, Economic Research Journal 9: 19–29 [in Chinese].Google Scholar
Price, L., Levine, M.D., Zhou, N., et al. . (2011), ‘Assessment of China's energy-saving and emission-reduction accomplishments and opportunities during the 11th Five Year Plan’, Energy Policy 39(4): 2165–2178.CrossRefGoogle Scholar
Roca, J. and Alcántara, V. (2001), ‘Energy intensity, CO2 emissions and the environmental Kuznets curve: the Spanish case’, Energy Policy 29(7): 553–556.Google Scholar
Romer, P. (1990), ‘Endogenous technological change’, Journal of Political Economy 98(5): S71–S102.Google Scholar
Schmalensee, R., Stoker, T.M., and Judson, R.A. (1998), ‘World carbon dioxide emissions: 1950–2050’, Review of Economics and Statistics 80(1): 15–27.Google Scholar
Solow, R.M. (1956), ‘A contribution to the theory of economic growth’, Quarterly Journal of Economics 70(1): 65–94.Google Scholar
Stern, D.I. (2004), ‘The rise and fall of the environmental Kuznets curve’, World Development 32(8): 1419–1439.Google Scholar
Stokey, N. (1998), ‘Are there limits to growth?’, International Economic Review 39(1): 1–31.CrossRefGoogle Scholar
Torras, M. and Boyce, J.K. (1998), ‘Income, inequality, and pollution: a reassessment of the environmental Kuznets curve’, Ecological Economics 25(2): 147–160.Google Scholar
Wagner, M. (2008), ‘The carbon Kuznets curve: a cloudy picture emitted by bad econometrics?’, Resource and Energy Economics 30(3): 388–408.CrossRefGoogle Scholar
Wang, Z.G., Gong, L.T., and Cheng, Y.Y. (2006), ‘China's regional differences in technical efficiency and the decomposition of total factor productivity growth (1978–2003)’, Social Sciences in China 2: 55–66 [in Chinese].Google Scholar
Weeks, M. and Yao, J.Y. (2003), ‘Provincial conditional income convergence in China, 1953–1997: a panel data approach’, Econometric Reviews 22(1): 59–77.Google Scholar
Wei, Y.-M., Liu, L., Wu, G., and Zou, L. (2010), Energy Economics: CO2 Emissions in China, Heidelberg: Springer.Google Scholar
Wu, Y. (2000), ‘Is China's growth sustainable? A productivity analysis’, China Economic Review 11(3): 278–296.Google Scholar
York, R., Rosa, E.A., and Dietz, T. (2003), ‘STIRPAT, IPAT and ImPACT: analytic tools for unpacking the driving forces of environmental impacts’, Ecological Economics 46(3): 351–365.Google Scholar
You, J. (2013), ‘China's challenge for decarbonized growth: forecasts from energy demand models’, Journal of Policy Modeling 35(4): 652–668.Google Scholar
Young, A. (2003), ‘Gold into base metals: productivity growth in the People's Republic of China during the Reform Period’, Journal of Political Economy 111(6): 1220–1261.Google Scholar
Zhang, J. and Zhang, Y. (2003), ‘Recalculating the capital of China and a review of Li and Tang's article’, Economic Research Journal 7: 35–43 [in Chinese].Google Scholar
Supplementary material: PDF

Hao supplementary material

Online Appendix

Download Hao supplementary material(PDF)
PDF 114.1 KB