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Can Carbon Emission Trading Policy Reduce PM2.5? Evidence from Hubei, China

Author

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  • Ruiqi Wang

    (College of Civil Engineering, Nanjing Forestry University, Nanjing 210037, China)

  • Huanchen Tang

    (College of Art & Design, Nanjing Forestry University, Nanjing 210037, China)

  • Xin Ma

    (College of Civil Engineering, Nanjing Forestry University, Nanjing 210037, China)

Abstract

China is facing serious haze pollution while its economy is developing at a high speed. Nevertheless, traditional command-and-control environmental regulation has been ineffective in reducing haze pollution. The Chinese government must find more effective ways to combat haze pollution immediately. Through the synthetic control method, this paper uses the provincial PM2.5 concentration and economic data from 2000 to 2016 to examine the causal effect between the Hubei carbon emission trading pilot and haze pollution, and further establish a mediating effect model to explore the impact mechanism between the carbon emission trading market and haze pollution. The results show that the pilot of carbon emission trading in Hubei Province has led to a decrease of PM2.5 by 10% in five years, which is significant at least at the level of 10%. It mainly achieves the purpose of reducing haze pollution by adjusting the energy structure and increasing R&D investment.

Suggested Citation

  • Ruiqi Wang & Huanchen Tang & Xin Ma, 2022. "Can Carbon Emission Trading Policy Reduce PM2.5? Evidence from Hubei, China," Sustainability, MDPI, vol. 14(17), pages 1-21, August.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:17:p:10755-:d:900753
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    Cited by:

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    2. Xiaoyu Ju & Jie Wan & Ziwei Zhang & Chunai Ma & Liangwei Zhang & Xiaodong Zhao, 2023. "Impact of Chinese Carbon Emissions Trading Policy on Chongqing’s Carbon Emissions and Economic Development," Sustainability, MDPI, vol. 15(5), pages 1-16, February.
    3. Wu, Xiaofei & Ma, Jie & Gao, Yanyan & Li, Bin & Chen, Xueli & Song, Malin, 2023. "Policy uncertainty and air pollution: Evidence from the turnover of local officials in China," Economic Analysis and Policy, Elsevier, vol. 80(C), pages 532-543.

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