Mismatched Social Welfare Allocation and PM2.5-Related Health Damage along Value Chains within China.

Value chains have played a critical part in the growth. However, the fairness of the social welfare allocation along the value chain is largely underinvestigated, especially when considering the harmful environmental and health effects associated with the production processes. We used fine-scale profiling to analyze the social welfare allocation along China's domestic value chain within the context of environmental and health effects and investigated the underlying mechanisms. Our results suggested that the top 10% regions in the value chain obtained 2.9 times more social income and 2.1 times more job opportunities than the average, with much lower health damage. Further inspection showed a significant contribution of the "siphon effect"─major resource providers suffer the most in terms of localized health damage along with insufficient social welfare for compensation. We found that inter-region atmosphere transport results in redistribution for 53% health damages, which decreases the welfare-damage mismatch at "suffering" regions but also causes serious health damage to more than half of regions and populations in total. Specifically, around 10% of regions have lower social welfare and also experienced a significant increase in health damage caused by atmospheric transport. These results highlighted the necessity of a value chain-oriented, quantitative compensation-driven policy.

China's domestic industry redistribution facilitates carbon emissions mitigation.

Industry redistribution is a common economic phenomenon that involves a dynamic configuration of the production location across a region, country, or the world. However, measurements of the associated pollutant emission effects have not been well conducted at the domestically regional level. Here, we calculate the CO2 emission changes induced by China's domestic inter-provincial industry redistribution during 2002-2017 using a counterfactual approach in the multi-regional input-output framework. We find that China's domestic industry redistribution decreased CO2 emissions during 2002-2017 and has considerable potential to continuously mitigate CO2 emissions in the future. We emphasize that the pollution haven effect may accompany the process of industry redistribution but can be weakened by effective policies, including stringent access thresholds in the regions undertaking industry relocation and regional industry structural upgrading. This paper provides policy recommendations for strengthening regional coordination to achieve China's transformation to carbon neutrality.

Regional trade agreement burdens global carbon emissions mitigation.

Regional trade agreements (RTAs) have been widely adopted to facilitate international trade and cross-border investment and promote economic development. However, ex ante measurements of the environmental effects of RTAs to date have not been well conducted. Here, we estimate the CO2 emissions burdens of the Regional Comprehensive Economic Partnership (RCEP) after evaluating its economic effects. We find that trade among RCEP member countries will increase significantly and economic output will expand with the reduction of regional tariffs. However, the results show that complete tariff elimination among RCEP members would increase the yearly global CO2 emissions from fuel combustion by about 3.1%, doubling the annual average growth rate of global CO2 emissions in the last decade. The emissions in some developing members will surge. In the longer run, the burdens can be lessened to some extent by the technological spillover effects of deeper trade liberalization. We stress that technological advancement and more effective climate policies are urgently required to avoid undermining international efforts to reduce global emissions.

The hit of the novel coronavirus outbreak to China's economy.

Broke out at the end of 2019, the novel coronavirus pneumonia (COVID-19) has been spreading throughout the world, leading to more than 87 million confirmed infections and 1.88 million fatalities. Motivated by this, we evaluate the economic impacts of COVID-19 outbreak on both national and industrial levels by employing quarterly computable general equilibrium (CGE) model. Our results reveal that the epidemic may lower China's economic growth in 2020 by 3.5%, versus 4.4% for final consumption (relative to baseline). The service industry suffers the most from the outbreak, and the Accommodation-Food-Beverage service, Wholesale-Retail Trade, and Transport-Storage-Post are identified as the most vulnerable sectors, with the negative impact on output reaching as high as 14.6%. When moving to 2021, the hit to economy shrinks to 2% (1.2-2.7%), with industry estimated to be the most affected sector instead. This study indicates that implementing effective measures for preventing and controlling the epidemic and policies for post-disease economic recovery play critical role in curbing the potential economic damage.