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Analysis of regional carbon allocation and carbon trading based on net primary productivity in China

Yinyin Wu, Ping Wang, Xin Liu, Jiandong Chen and Malin Song

China Economic Review, 2020, vol. 60, issue C

Abstract: Ecological balance and carbon sink economies have gained increased attention for tackling global warming. Based on an improved Carnegie–Ames–Stanford Approach model, this study demonstrated regional Net Primary Productivity (NPP) and analyzed regional carbon overdraft situations in China during 2005–2015. Regional carbon allowances were allocated according to carrying capacity of carbon sequestration and China's carbon intensity reduction goals in “13th Five-year plan”. Data Envelopment Analysis (DEA) technology with panel data was further employed to estimate potential benefits resulting from carbon trading and a carbon sink economy. Regional NPP decreased from south to north and from coast to inland, while regions with severe carbon overdrafts were gathered in North and East China. In order to maintain a regional carbon balance with lower abatement costs, regional cooperation of emission reduction within either North or East China is proposed in this study. It is concluded that the majority of provinces and cities in Eastern China and some provinces in the west would be the major purchasers of carbon credits under a national carbon emissions trading (CET) market. Following the introduction of emissions offset mechanisms, Yunnan, Sichuan, and Heilongjiang would be the major providers of carbon sinks in China.

Keywords: Net primary productivity; Data envelopment analysis; Carbon emissions trading; Carbon sink economy (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:60:y:2020:i:c:s1043951x19301622

DOI: 10.1016/j.chieco.2019.101401

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China Economic Review is currently edited by B.M. Fleisher, K. X. D. Huang, M.E. Lovely, Y. Wen, X. Zhang and X. Zhu

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