Assessing the environmental impacts of clean energy investment in Pakistan using a dynamic autoregressive distributed lag model.

In this study, the authors projected the impacts of clean energy investment on environmental degradation by applying a novel and dynamic Autoregressive Distributed Lag (DARDL) model for Pakistan from 1990 to 2022. Most researchers have used ecological footprint or CO2 emissions indicators to look at how clean energy investment affects environmental degradation, which primarily represents contamination induced by humans' consumption patterns and does not consider the impact of the supply side. Against this background, the study scrutinized the dynamic interaction between clean energy investment and environmental sustainability using the load capacity factor (LCF) as an ecological indicator in Pakistan, including economic growth, population density, trade openness, urbanization, and industrialization in the analysis. The long-run estimates from DARDL indicate that a 1 percent upsurge in clean energy investment mitigates environmental degradation by approximately 0.42 percent on average, controlling for other factors. Further, the study also revealed that a 1 percent increase in clean energy investment diminishes dirty energy consumption by approximately 0.45 percent. The validity of the findings is confirmed using alternate methods, i.e., KRLS. The study recommends that Pakistan prioritize investment in clean energy projects to promote environmental sustainability and enforce environmental regulations to reduce the adverse externalities associated with dirty energy activities.

How can green finance effectively promote low-carbon cities? Evidence from 237 cities in China.

Urban areas contribute 85% of China's CO2 emissions. Green finance is an important means to support green energy development and achieve the low-carbon transformation of high-energy-consuming industries. The motivation of this article is to investigate the impact and mechanism of green finance on urban carbon intensity. Most existing literature uses linear models to investigate urban carbon intensity, ignoring the nonlinear relationships between economic variables. The nonparametric models can fill the inherent shortcomings of linear models and effectively simulate the nonlinear nexus between economic variables. Based on the 2011-2021 panel data of 237 cities in China, this paper applies the nonparametric additive model to survey the influence of green finance on urban carbon intensity. Empirical findings exhibit that green finance exerts an inverted U-shaped effect on urban carbon intensity, indicating that the carbon reduction effect of green finance has gradually shifted from inconspicuous in the early stages to prominent in the later stages. Then, from the perspectives of region, city size, and carbon intensity, this article conducts heterogeneity analysis. The results show that the impact of green finance on various carbon intensities all exhibits obvious nonlinear feature. Furthermore, this article employs a mediation effect model to conduct mechanism analysis. The results display that technological progress and industrial structure are two important mediating variables, both of which produce an inverted U-shaped nonlinear impact on urban carbon intensity.

Assessing the impact of environmental regulations on environmental performance in Chinese cities: A spatial Stochastic Frontier Model with endogeneity analysis.

The Chinese government has implemented environmental regulations to address the deterioration of air quality associated with rapid industrialization. However, there is no consensus on whether environmental regulations are beneficial to environmental performance. The technical challenges related to endogeneity and spatial correlation may bias the estimation of the emission reduction effect of regulations. In this study, we comprehensively evaluate the environmental performance of sulfur dioxide regulations in Chinese cities using a novel stochastic frontier model that introduces the single control function to correct estimation errors caused by spatial spillovers and endogeneity. Our analysis emphasizes that insufficient resolution of endogeneity or spatial spillovers may lead to underestimation or neglect of the environmental performance improvements achieved by these regulations. On the contrary, our revised research results indicate that regulations aimed at reducing sulfur dioxide emissions not only successfully control sulfur dioxide emissions, but also have a positive impact on reducing carbon emissions. In addition, we conduct in-depth research on the mechanisms by which environmental regulations improve performance by stimulating green technology innovation and promoting industrial structure upgrading. Based on our research findings, we propose policy recommendations to establish a city cooperation mechanism of technology exchange to achieve synergistic emission reduction and strengthen regional factor circulation.

Evaluating forest depletion and structural change effects on environmental sustainability in Pakistan: Through the lens of the load capacity factor.

The pace of species extinction and deforestation has increased dramatically due to the substantial increase in global environmental degradation. This trend is approaching the crucial temperature threshold of 2 °C and calls for more attention. Although previous research has observed the individual impacts of forest depletion, structural change, economic growth, and urbanization on various sustainability outcomes, there has been no previous research into their interrelationships with an emphasis on the load capacity factor (LCF). Furthermore, no previous study has examined the environmental impacts of the abovementioned variables by contrasting the results of LCF and CO2 emissions in Pakistan. Therefore, this research suggests a theoretical framework that integrates these concepts, provides a roadmap for an effective and sustainable mitigation strategy for Pakistan and compares LCF results with CO2 emissions. Using the time-series data from 1970 to 2021, a unique and sophisticated dynamic Autoregressive Distributed Lag (DARDL) technique, the authors found that (i) a 1 % rise in forest depletion leads to a decline in load capacity factor by 0.026 %. (ii) A one per cent upsurge in structural change fosters environmental sustainability by raising the load capacity factor by 0.084 %. (iii) An increase of 1 % in economic growth dwindles the load capacity factor by 0.027 %. (iv) A one per cent surge in urbanization enhances the load capacity factor by 0.029 %. The findings suggest that Pakistan's Government should promote afforestation by emphasizing the constructive role of structural change in achieving environmental sustainability.

Synergistic disparities of pollution reduction and carbon mitigation in the industrial chain: Evidence from China's industrial sector.

The synergistic enhancement of pollution reduction and carbon mitigation (PRCM) is an inevitable requirement for China's ecological civilization construction. Existing studies primarily focus on macro-level research, and there is a relative lack of research specifically addressing the micro-level of industrial chains. Based on non-competitive IO tables, this study employed the structural path decomposition analysis method to analyze the synergistic disparities of the PRCM industry chain and its driving factors. The findings reveal: (1) The crucial emission industrial chains for CO2, SO2, and PM show a high overlap degree, accounting for 46.67 %, 46.67 %, 60.00 %, 50.00 %, and 56.67 % during 2002-2020. The PRCM industrial chains are operating at a low synergistic level, with proportions of only 13.33 %, 23.33 %, 20.00 %, and 16.67 %. PRCM exhibits a "similar origin with different paths" phenomenon. (2) China's carbon mitigation policies can reduce pollution, whereas pollution reduction policies have limited carbon mitigation effects. (3) The emission control effect is the primary disparate factor in PRCM synergy, while other factors exhibit consistent impact direction to three emissions. The study's conclusions and corresponding policy suggestions hold significant theoretical and practical implications for relevant authorities to systematically plan synergistic emission reduction pathways and establish targeted synergistic policies.

Evaluating the synergistic effect of digitalization and industrialization on total factor carbon emission performance.

Combating climate change and reducing carbon dioxide emissions are serious challenges shared by countries around the world. In the current era, digitalization has a significant impact on CO2 emissions. However, prior studies have not assessed the synergy between digitalization and industrialization on carbon emission performance. The principal component analysis and non-radial directional distance function (NDDF) are used to measure the digitalization and total factor carbon emission performance of Chinese 245 prefecture-level cities from 2003 to 2019. This study establishes a fixed effects model to study the panel data. The findings are as follows: (1) Digitalization can significantly promote Chinese cities' CO2 emission reduction. This result still holds after several robustness checks. (2) The heterogeneity results indicate that digitalization mainly improves central cities' carbon emission performance. Meanwhile, the impact of digitalization is more obvious after 2011. (3) Digitalization improves urban carbon emission performance through energy efficiency, industrial transformation, and technological innovation. (4) It is worth noting that digitalization synergizes with industrialization to improve carbon emission performance in Chinese cities. This study provides empirical evidence and some constructive policy recommendations for the government to push the collaborative development of the digitalization and low-carbon economy.

Green technology innovation under differentiated carbon constraints: The substitution effect of industrial relocation.

The relationship between the carbon intensity constraint policy (CICP) and green technology innovation (GTI) has been well documented in the literature. However, the allocation method of the carbon abatement target is often ignored. The allocation method plays a decisive role in the policy effect. After alleviating the possible endogenous problems through quasi natural experiment, we find that the CICP with the special allocation method promotes GTI in the western provinces but inhibits GTI in the eastern provinces. Especially, the positive impact in the western provinces presents an intensifying trend. To discuss the potential mechanism, we further construct a three-dimensional panel, which contains 1.84 million observations. Our macro and micro evidences reveal that manufacturing firms in the eastern provinces tend to move westward under carbon constraints rather than GTI. In other words, the industrial relocation has a substitution effect on GTI, which further explains why the CICP inhibits GTI in the eastern provinces. The above findings offer targeted policy reference for regulators and government departments concerned with the issues of carbon emission reduction and GTI.

The effects of capital-biased tax incentives on firm energy intensity: Environmental dividend or consequence?

Capital and energy are essential input factors in the production and operation of firms, and they are closely interconnected. Nudging firms to improve energy performance during capital investment is crucial for attaining green competitiveness. Nonetheless, little is known about how capital-biased tax incentives affect firm energy performance in the process of encouraging firms to update or expand fixed assets. To fill this critical gap, this paper leverages the 2014 and 2015 accelerated depreciation policy for fixed assets as quasi-natural experiments to investigate the impact of capital-biased tax incentives on firm energy intensity. This study uses information from a unique dataset of Chinese firms, and the staggered difference-in-difference strategy is constructed to address identification challenges. The findings of this paper are as follows: (1) The accelerated depreciation policy for fixed assets significantly increases firm energy intensity by approximately 11.2%. A series of validations reinforce the robustness of this result. (2) Restructuring energy use and the factor substitution of energy for labour are the main channels through which the accelerated depreciation policy for fixed assets increases firm energy intensity. (3) The accelerated depreciation policy for fixed assets has a more remarkable effect on the energy intensity enhancement of small-scale firms, capital-intensive firms, and firms in energy-endowed regions. These conclusions support shaping policy options moderately by coordinating tax incentives and government regulation as key factors in promoting sustainable firm development. Overall, this research provides empirical evidence regarding the micro-environmental consequences of capital-biased tax incentives and offers valuable insights for enhancing corporate energy performance.

The impact of fiscal transfer payments on energy conservation and emission reduction in China: Does the development stage matter?

Fiscal transfer payments (TRANS) are the institutional supplement of Chinese-style fiscal decentralization, which is of great significance to economic development. However, the relationship between TRANS and energy conservation and emission reduction (ECER) remains to be further discussed. Using panel data of 30 provinces in China from 2003 to 2020, this study empirically examines the impact of TRANS on energy-environmental performance (EEP) from the perspectives of influence mechanism, regional heterogeneity and nonlinearity. The results show that the influence of TRANS on ECER presents an obvious U-shaped relationship, and this influence has regional heterogeneity. At the same time, the investment-driven effect, infrastructure effect and industrial structure effect are important channels through which TRANS affect ECER. The partially linear functional coefficient models show that TRANS have different effects in different development stages. With the continuous improvement of economic level and urbanization level, the promotion effect of TRANS on ECER is more and more obvious. These results indicate that the government should increase fiscal investment in ECER, and pay attention to the development stage of different regions.

Choosing the right policy: Factors influencing the preferences of consumption-side personal carbon reduction policies.

With the development of the social economy and the improvement of personal income, the government must consider formulating personal carbon reduction policies to reduce carbon emissions from the consumption side. Therefore, it is valuable to understand the public's preferences for different policies and the factors influencing the willingness of policy support, which can help policy selection and promotion. Using data collected from 2801 college students and a multinomial logit model, this study explores the influence of personal and social factors on preferences for three different personal carbon reduction policies (personal carbon trading, carbon tax, and carbon generalized system of preferences). The results show that individuals with higher levels of affluence, social trust, and social norms prefer personal carbon trading; individuals with higher levels of affluence, self-motivation, and social norms prefer carbon tax; individuals with higher levels of low-carbon behavioral attitudes and social trust prefer carbon generalized system of preferences; and low-carbon responsibility, access to low-carbon information, and social equity are beneficial to all three policies. In addition, this study examined the heterogeneity of individuals with different levels of affluence and low-carbon behavioral attitudes. This study compares the differences in influencing factors of policy preferences, clarifies the effects of various personal and social factors, which can help the government to design consumption-side personal carbon reduction policies in the future, and provide a reference for the promotion of corresponding policies.

Does the Emission Trading Scheme achieve the dual dividend of reducing pollution and improving energy efficiency? Micro evidence from China.

Resolving the negative externality of environmental pollution has always been a concern in both the theoretical and practical space. To stimulate enterprises to participate in environmental governance actively, China has implemented a series of environmental regulation policies. The Emission Trading Pilot Scheme (ETPS) is an example of such policies implemented to ensure the gradual transition toward marketization. From a micro-enterprise perspective, the study examines how this policy achieves the dual effects of reducing emissions and promoting energy efficiency. We further explore potential channels through which this policy influences the dual effects. We empirically find ETPS to reduce the pollution emissions of enterprises significantly. However, the pollution reduction effect is mainly achieved by encouraging enterprises to strengthen cleaner production rather than through end governance. In addition to bringing environmental dividends, we observe ETPS to improve fossil energy efficiency by about 7.5% indirectly. We conclude by urging policy makers and participants to optimize energy structures and adjust intermediate input as they serve as significant pathways through which ETPS can affect fossil energy efficiency. The ETPS can encourage enterprises to actively step out of their "comfort zone" of environmental governance to be viewed as an effective environmental regulation policy.

Does tourism industry agglomeration improve China's energy and carbon emissions performance?

The tourism industry is seen as having great potential, but tourism development and tourism activities may increase energy consumption and environmental pressure. Based on the provincial panel data of China from 2000 to 2017, we calculate the energy and carbon emission performance by using the non-radial distance function (NDDF) and further investigate the impact of tourism industry agglomeration on energy and carbon emission efficiency by combining the panel fixed effect model, mediation effect model and quantile regression. Our research results show that there is an inverted U-shaped relationship between tourism industry agglomeration and energy and carbon emission efficiency, and tourism industry agglomeration can improve energy and carbon emission efficiency at present. At the same time, the impact of tourism industry agglomeration on energy and carbon emission efficiency has regional heterogeneity. The industrial structure upgrading plays an important role in the process of tourism industry agglomeration. In addition, with the improvement of energy and carbon emission performance, the impact of tourism industry agglomeration is also different. These findings suggest that policymakers should promote tourism industry agglomeration to realize energy conservation and emission reduction. The Chinese government should focus on the tourism resources and advantages of different regions and formulate differentiated regional policies to improve ecological performance.

Does Energy Efficiency Realize Energy Conservation in the Iron and Steel Industry? A Perspective of Energy Rebound Effect.

The energy rebound effect may weaken the impact of energy efficiency improvement on energy consumption. Therefore, the rebound effect is an important consideration in energy and environmental policies. This study takes the iron and steel industry as the research object, which is a large energy consumption sector in China, and the improved technique is used to estimate the energy rebound effect. The study constructs the dynamic energy efficiency utilizing provincial data from 2000 to 2019. The energy rebound effect from factor substitution and output expansion is then calculated. The research further discusses regional differences in the energy rebound effect. The results indicate that the technical progress of the iron and steel industry promotes energy efficiency improvements. The eastern region shows the best energy efficiency performance, followed by the central area, and the western region performs the worst in energy efficiency. The industrial energy rebound effect is 0.4297, which partially offsets the energy reduction caused by energy efficiency improvements. Factor substitution and output growth produce the industrial energy rebound effect. Furthermore, the rebound effect exhibits distinct geographical features. The policy suggestions are finally proposed to mitigate the industrial rebound effect and achieve energy and carbon reductions.

How does digital finance influence green technology innovation in China? Evidence from the financing constraints perspective.

Green innovation activities of enterprises often fall into the dilemma of financing constraints. Hence, it is urgent that the financial system develops and becomes innovative, especially for a developing country like China. Existing literature mainly explores the influencing factors of green innovation from the environmental regulation, economic growth and government subsidies perspective. However, few papers critically study how digital finance influences green innovations. To explore the internal influencing mechanism of digital finance on the quantity and quality of green technology innovation, panel data of 271 prefecture-level cities from 2011 to 2019 in China is used. Based on theoretical analysis and empirical research, we get the following conclusions. First, digital finance can improve the quantity and quality of green technological innovation, which has become a significant driving force for green innovations in China. The results are still robust after the endogeneity tests. Second, the results of heterogeneous analysis indicate that the different dimensions of digital finance can improve green innovations. They include breadth of coverage, depth of use, and degree of digitization. The positive effect of digital finance is most substantial in eastern cities, followed by central cities, and weakest in western cities. Third, digital finance indirectly improves green innovation mainly by alleviating financing constraints. Our empirical results provide policy enlightenment for realizing the coordination of China's urban digital transformation and green economic development.

Vanishing Happiness: How Does Pollution Information Disclosure Affect Life Satisfaction?

The role of information in energy and environmental policies is receiving extensive attention. This paper examines the impact of pollution information on residents' life satisfaction and its channels in China. A difference-in-difference (DID) approach is used to match China Family Panel Studies (CFPS) data with information disclosure data to find the negative impact of PM2.5 information disclosure on residents' life satisfaction. Heterogeneity analysis shows that the negative effects of information disclosure are more pronounced among young and middle-aged groups, residents with good physical conditions, higher education, higher income, and urban residents. The mechanism analysis indicates that the perception, avoidance, and envy effect are three important channels of influence. These findings provide some insights for public policy formulation aimed at enhancing the well-being of an entire population, such as paying attention to the psychological impact of policy implementation on different groups of people.

Does environmental decentralization aggravate pollution emissions? Microscopic evidence from Chinese industrial enterprises.

Rational division of environmental management power among governments is a necessary institutional support for speeding up the realization of green development goals. Based on the combined microdata of China Industrial Enterprise Database and China Enterprise Pollution Database from 2000 to 2012, the effect of environmental decentralization on enterprise pollution emission is empirically examined in this research. Results show that Chinese-style environmental decentralization, especially environmental supervision decentralization and environmental monitoring decentralization, significantly aggravates the pollution emissions of enterprises. Moreover, the impact of environmental decentralization on enterprise pollution emissions has regional and enterprise ownership heterogeneity. The mechanism test results denote that the production scale effect, energy structure effect and pollution control effect are the micro mechanisms of environmental decentralization aggravating the pollution emission of enterprises. This research confirms the existence of "race to the bottom" among local governments in China and provides evidence support and beneficial enlightenment for the vertical reform of the environmental management system.

Does Use of Solid Cooking Fuels Increase Family Medical Expenses in China?

China has tried to replace solid fuels with cleaner energy in households. The benefits of fuel switching need to be identified. This article shows that households using solid cooking fuels suffer heavier medical expenses than those using non-solid cooking fuels. After accounting for family characteristics, using solid fuels is associated with 1.4-1.9% increases in medical care. Through the analysis of the impact mechanism, we found that solid cooking fuels harm the health conditions of family members and increase the probability of illness, thereby increasing medical expenses, while the ratio of fuel fees does not change significantly if switching cooking fuels. Furthermore, we explored heterogeneity to better understand the underlying relationship. For urban and higher-educated families with house ownership, the impact of solid fuels on medical expenses was weaker compared to rural and lower-educated households without owned houses. Therefore, considering the costs and benefits, we recommend continuing the conversion from solid fuels to non-solid fuels. In the fuel transition process, it is beneficial to raise residents' awareness and improve behavior to avoid indoor air pollution.

The long term effects of carbon trading markets in China: Evidence from energy intensive industries.

Carbon trading scheme is an instrument adopted in many countries of the world to reduce CO2 emissions. As an important way of environmental regulation, whether it can reduce the emissions and promote the economic development at the same time needs further investigation. This paper tests whether the Porter Hypothesis is true in China's carbon emissions trading scheme for energy intensive industries. Using provincial-level, industrial-level and firm-level data, we construct a DEA model that can incorporate the emissions trading behavior among different decision making units to show that the carbon emissions trading scheme can only reduce the CO2 emissions but cannot increase the output significantly. That is, the carbon intensity is decreased. The reason is that the carbon trading scheme is conducive to the improvement of the production efficiency, and firm-level research and development input increases after carbon trading scheme. These findings are robust to several robustness checks. Our paper demonstrates the effectiveness of the carbon emissions trading scheme in reducing emissions. An external technological breakthrough is needed if the win-win situation of reducing CO2 emissions and promoting economic development simultaneously is wanted to be achieved.

Does energy efficiency make sense in China? Based on the perspective of economic growth quality.

Whether energy efficiency can significantly improve economic growth quality is an important perspective to understand the relationship between energy and economic growth. Based on the provincial data during 2000-2017 in China, this study uses the Shepherd energy distance function and entropy weight method to calculate the energy efficiency and economic growth quality of each province, and investigates the impact of energy efficiency on economic growth quality. The results indicate that energy efficiency does not significantly improve economic growth quality, but there is an obvious U-shaped relationship between energy efficiency and economic growth quality. The influence of energy efficiency has significant regional heterogeneity. Energy efficiency significantly increases economic growth quality in the eastern regions but significantly reduces economic growth quality in the central and western regions. Meanwhile, energy efficiency has a positive U-shaped relationship with economic growth quality in the eastern and central regions. Moreover, the upgrading of industrial structure plays an important role in the process of energy efficiency affecting economic growth quality. In response to the above conclusions, this paper puts forward the targeted policy implications to improve China's energy efficiency and promote high-quality economic development.

Towards carbon neutrality: The role of different paths of technological progress in mitigating China's CO2 emissions.

China's carbon neutrality in 2060 is a hot issue discussed by policymakers and scholars. Previous literature shows that technological progress is the key to CO2 emission mitigation, but ignores the role of different paths of technological progress. This paper uses the panel data covering China's 30 provinces from 2008 to 2017 to study the effect of different paths of technological progress on CO2 emissions including domestic innovation, foreign technology import and regional technology transfer. Furthermore, the assimilation effect of technologies from domestic and foreign is investigated, and its impact on CO2 emissions is explored. The empirical evidence indicates that: (1) there is an inverted U-shaped relationship between domestic innovation and China's CO2 emissions. (2) Foreign technology imports cannot decrease CO2 emissions and carbon intensity in high-emission regions. Meanwhile, domestic technology transfer increase CO2 emissions and carbon intensity in high-emission regions. However, foreign technology import of low-emission areas can achieve CO2 emission mitigation. (3) The assimilation of technologies from abroad and domestic can increase CO2 emissions and carbon intensity in high-emission regions. But the absorption effect of technologies from domestic can decrease CO2 emissions and carbon intensity in low-carbon regions. According to the above results, this paper proposes some targeted policy suggestions for the choice of technological progress paths for CO2 emission mitigation in different regions of China.