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Economic Policy Uncertainty and Co-Control of Air Pollutants and CO 2 : Evidence from 282 Cities in China

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  • Xuan Yang

    (School of Environment and Natural Resources, Renmin University of China, Beijing 100872, China)

  • Geng Chen

    (School of Business, Hong Kong Baptist University, Hong Kong, China)

  • Chunzi Qu

    (Department of Business and Management Science, Norwegian School of Economics, 5045 Bergen, Norway)

  • Zhixuan Chen

    (School of Environment and Natural Resources, Renmin University of China, Beijing 100872, China)

  • Yang Wen

    (Chinese Academy of Macroeconomic Research, Beijing 100038, China
    Institute of Spatial Planning & Regional Economy, National Development and Reform Commission (NDRC), Beijing 100038, China)

  • Lei Shi

    (School of Environment and Natural Resources, Renmin University of China, Beijing 100872, China)

  • Feng Long

    (Chinese Academy of Environmental Planning, Beijing 100041, China)

Abstract

China is currently focusing on the cooperative control of air pollution and CO 2 emissions, as well as the mitigation of economic policy uncertainty (EPU). By using panel data from 282 cities spanning from 2003 to 2017 and a newly constructed city-level EPU index, a spatial Durbin, two-way fixed-effects model is employed, with the aim of estimating the impact of EPU on the synergistic emissions intensity (SEI) of air pollutants and CO 2 . Additionally, this paper investigates the potential channels through which EPU influences SEI. It also explores how pressures related to environmental protection and economic development affect the impact of EPU on SEI. The results indicate that a unit increase in EPU will result in a rise in the SEI of local cities, adjacent cities, and total cities by 930.9%, 69,162.7%, and 70,093.6%, respectively. Moreover, the channel analysis suggests that EPU exacerbates SEI by undermining the upgrading of the industrial structure, augmenting industrial structure distortion, and escalating labor market distortion. Furthermore, the effect of EPU on SEI may be lessened by an increase in environmental protection pressure, while an increase in economic development pressure may exert a positive influence. Finally, this paper concludes by recommending that policymakers should prioritize the maintenance and stability of economic policies, facilitate the advancement of the industrial structure, enhance the efficiency of labor resource allocation, and underscore the significance of managing urban air pollution and CO 2 emissions.

Suggested Citation

  • Xuan Yang & Geng Chen & Chunzi Qu & Zhixuan Chen & Yang Wen & Lei Shi & Feng Long, 2024. "Economic Policy Uncertainty and Co-Control of Air Pollutants and CO 2 : Evidence from 282 Cities in China," Energies, MDPI, vol. 17(11), pages 1-23, May.
    • Handle: RePEc:gam:jeners:v:17:y:2024:i:11:p:2675-:d:1406200
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    References listed on IDEAS

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