Balancing Carbon Emissions with Economic Development: Carbon Productivity In China

Abstract

Carbon productivity measures the Gross Domestic Product generated per unit of carbon dioxide emission to balance the carbon emissions with economic growth. Improving carbon productivity is one of the coping strategies to reduce carbon emissions through energy efficiency in China. The thesis analyzes the factors related to carbon productivity with panel data in 31 administrative divisions in mainland of China from 1997 to 2017. Built on the extended Stochastic Impacts by Regression on Population, Affluence, and Technology (STIRPAT) model, there is a significant and positive correlation between carbon productivity and GDP per capita. Besides, carbon dioxide emission from coal is negatively correlated with carbon productivity with statistical significance. The conclusion is that improving carbon productivity is consistent with economic development in China, and phasing out coal consumption is one potential way to decarbonize the economy. Future decarbonization policies should leverage regional differences in China concerning socio-economic disparities, energy structure, and technological level.