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Can Carbon Trading Policies Promote Regional Green Innovation Efficiency? Empirical Data from Pilot Regions in China

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  • Baoliu Liu

    (School of Economics and Management, Tianjin University of Science & Technology, Tianjin 300457, China)

  • Zhenqing Sun

    (School of Economics and Management, Tianjin University of Science & Technology, Tianjin 300457, China)

  • Huanhuan Li

    (School of Economics and Management, Tianjin University of Science & Technology, Tianjin 300457, China)

Abstract

Although the emission reduction and innovation effects of carbon emissions trading have attracted considerable interest among academics and policy makers, there is a lack of empirical research on how carbon trading pilots in China promote regional green innovation. Therefore, we measured the green innovation efficiency of 30 provinces and cities in mainland China from 2005 to 2018, using selected panel data within a super-efficient SBM model that incorporated undesirable outputs. We used a double differential model to evaluate the impacts of carbon trading policies on the green innovation efficiency of seven carbon trading pilot regions. These impacts were confirmed using the double differential propensity score matching method. Our findings were as follows. (1) The implementation of carbon trading policies has a significant and continuous effect of promoting and improving green innovation efficiency in the pilot areas. (2) Carbon trading induces technological innovation effects, enabling green innovation potential to be realized. Regional green innovation efficiency is further improved through energy substitution and structural upgrading effects and subsequently through all three of the above effects. (3) The synergy between the three major effects of carbon trading policies amplifies regional green innovation efficiency. Therefore, the Chinese government should accelerate its efforts to develop and improve carbon markets, promote carbon trading policies, and actively foster synergy among the three effects to achieve green and sustainable regional development.

Suggested Citation

  • Baoliu Liu & Zhenqing Sun & Huanhuan Li, 2021. "Can Carbon Trading Policies Promote Regional Green Innovation Efficiency? Empirical Data from Pilot Regions in China," Sustainability, MDPI, vol. 13(5), pages 1-15, March.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:5:p:2891-:d:512373
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    References listed on IDEAS

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    Cited by:

    1. Haochang Yang & Xuan Zhu, 2022. "Research on Green Innovation Performance of Manufacturing Industry and Its Improvement Path in China," Sustainability, MDPI, vol. 14(13), pages 1-21, June.
    2. Lingming Chen & Congjia Huo, 2021. "Impact of Green Innovation Efficiency on Carbon Emission Reduction in the Guangdong-Hong Kong-Macao GBA," Sustainability, MDPI, vol. 13(23), pages 1-22, December.
    3. Xueyang Wang & Xiumei Sun & Haotian Zhang & Chaokai Xue, 2022. "Digital Economy Development and Urban Green Innovation CA-Pability: Based on Panel Data of 274 Prefecture-Level Cities in China," Sustainability, MDPI, vol. 14(5), pages 1-21, March.
    4. Yunhe Cheng & Beibei Hu, 2022. "Forecasting Regional Carbon Prices in China Based on Secondary Decomposition and a Hybrid Kernel-Based Extreme Learning Machine," Energies, MDPI, vol. 15(10), pages 1-18, May.
    5. Wu, Rongxin & Tan, Zhizhou & Lin, Boqiang, 2023. "Does carbon emission trading scheme really improve the CO2 emission efficiency? Evidence from China's iron and steel industry," Energy, Elsevier, vol. 277(C).
    6. Xu Chu & Yuntao Bai & Congshan Li, 2024. "The Dark Side of Firms’ Green Technology Innovation on Corporate Social Responsibility: Evidence from China," Journal of Business Ethics, Springer, vol. 195(1), pages 47-66, November.
    7. Wenjun Ge & Derong Yang & Weineng Chen & Sheng Li, 2023. "Can Setting Up a Carbon Trading Mechanism Improve Urban Eco-Efficiency? Evidence from China," Sustainability, MDPI, vol. 15(4), pages 1-19, February.
    8. Sheng Xu & Jingxue Chen & Demei Wen, 2023. "Research on the Impact of Carbon Trading Policy on the Structural Upgrading of Marine Industry," Sustainability, MDPI, vol. 15(9), pages 1-17, April.
    9. Li, Zhiguo & Wang, Jie, 2022. "Spatial spillover effect of carbon emission trading on carbon emission reduction: Empirical data from pilot regions in China," Energy, Elsevier, vol. 251(C).
    10. Qiong Wu & Kanittha Tambunlertchai & Pongsa Pornchaiwiseskul, 2021. "Examining the Impact and Influencing Channels of Carbon Emission Trading Pilot Markets in China," Sustainability, MDPI, vol. 13(10), pages 1-18, May.
    11. Biao Hu & Kai Yuan & Tingyun Niu & Liang Zhang & Yuqiong Guan, 2022. "Study on the Spatial and Temporal Evolution Patterns of Green Innovation Efficiency and Driving Factors in Three Major Urban Agglomerations in China—Based on the Perspective of Economic Geography," Sustainability, MDPI, vol. 14(15), pages 1-28, July.
    12. Chen, Yang & Mu, Huaizhong, 2023. "Natural resources, carbon trading policies and total factor carbon efficiency: A new direction for China’s economy," Resources Policy, Elsevier, vol. 86(PA).
    13. Beibei Hu & Yunhe Cheng, 2023. "Prediction of Regional Carbon Price in China Based on Secondary Decomposition and Nonlinear Error Correction," Energies, MDPI, vol. 16(11), pages 1-22, May.

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