China needs to reduce its carbon emissions if global climate change mitigation is to succeed. Conventional economic analysis views cutting emissions as a cost, creating a collective action problem. However, decarbonization can improve productivity and provide co-benefits that accord with multiple national policy objectives. We track China's progress in reducing the emissions intensity of the economy, and construct a macro scenario with China's carbon emissions peaking in the 2020s. Investment in greater energy productivity and economic restructuring away from heavy industries can bring productivity gains, and decarbonization of energy supply has important co-benefits for air pollution and energy security. Combined with lower climate change risks and the likelihood that China's actions will influence other countries, this suggests that cutting carbon emissions is not only in China's self-interest but also in the global interest. To properly identify the true costs and benefits of climate change action requires new thinking in economic analysis.
The paper appears in the Special Issue: Climate Change and Green Growth: New Thinking.
Green growth is a relatively new concept aimed at focusing attention on achieving sustainable development through the efficient use of environmental assets without slowing economic growth. This paper presents a real-world application of the concept, and identifies viable policy options for achieving a complementary environmental regulatory framework that minimizes output and employment losses. The analysis utilizes macro level data from the Turkish economy, and develops an applied general equilibrium model to assess the impact of a selected number of green policy instruments and public policy intervention mechanisms, including market-based incentives designed to accelerate technology adoption and achieve higher employment and sustainable growth patterns.
This paper analyses the performance of the Dutch “Green Funds Scheme”. This scheme is a policy instrument to advance green projects. The scheme relies on tax compensation for private investors who save or invest in green institutions below market returns. The green institutions select and monitor certified green projects and pass through part of the lower funding costs to investors. Certification of the green projects is based on environmental value-added and innovation. The authors provide a description of the characteristics of this incentive scheme and investigate the scheme's performance.
This article appears in the Special Issue: Green Economy and Sustainable Development.
A rather young but rapidly accelerating biofuel industry has recently emerged in China. However, there is no legislation or policy specifically regulating biofuels or bioenergy. In addition, most of the regulatory functions are undertaken by policy initiatives rather than by law. As a result, the regulation and, in a broader context, governance of biofuels still face several major obstacles, including unclear development directions, ignored impact of biofuels development on society, environment and economy, and limited public participation. This paper argues that legislation on biofuels in the form of joint departmental rule is a departure for a comprehensive regulatory framework to overcome the current obstacles and to realize the sustainable development of the biofuels industry in China.
This article appears in the Special Issue: Green Economy and Sustainable Development.