How Does Vertical Fiscal Imbalance Affect CO 2 Emissions? The Role of Capital Mismatch

Tianchu Feng (), Meijuan Liu () and Chaozhu Li
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Tianchu Feng: School of Economics and Management, Zhejiang Agriculture and Forestry University, Hangzhou 311300, China
Meijuan Liu: School of Economics and Management, Zhejiang Agriculture and Forestry University, Hangzhou 311300, China
Chaozhu Li: Jiyang College, Zhejiang Agriculture and Forestry University, Zhuji 311800, China

Sustainability, 2022, vol. 14, issue 17, 1-15

Abstract: Climate warming caused by greenhouse gases is an important practical issue. This study aims to explore the impact of the vertical fiscal imbalance (VFI) on CO 2 emissions from the perspective of theoretical analysis and empirical research. This study uses panel data from 30 provinces in China from 2004 to 2018 in order to test this issue. The results show that the VFI has a significant positive impact on CO 2 emissions and that the capital misallocation exacerbates the positive impact of the VFI on CO 2 emissions. These study results also have a significant temporal heterogeneity. The sample results dating after 2008 were more significant. These conclusions provide economic and political references for local governments in order to develop CO 2 neutrality and CO 2 peaking policy goals and to promote an in-depth reform of the fiscal system.

Keywords: vertical fiscal imbalance; capital mismatch; CO 2 emissions (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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