China's low-carbon technology trade: Facts and implications

Kevin P. Gallagher, Renliang Liu, Jiaqi Lu, Ruyu Yin, Miaojie Yu and Praveena Bandara

China Economic Review, 2025, vol. 92, issue C

Abstract: This study examines China's evolving role in global low-carbon technology (LCT) trade and its impact on climate mitigation. The novel data suggests China's transition from a net importer to a net exporter of LCTs over the past three decades. Employing a gravity-equation framework, we identify the economic and institutional factors that drive bilateral LCT flows. Fixed-effects regressions show that China's LCT exports significantly reduce partner-country CO₂ emissions, measured in total, per-capita, and intensity terms, and that these reductions are larger for high-income partners and for the energy-storage and pollution-control LCTs. We further find that partner-country human capital, political stability, and development assistance amplify these environmental benefits. We conclude with policy recommendations including sustained R&D investment, stable export prices, encouragement of outward FDI, further trade liberalization and improved international dialogue on capacity issues to advance global sustainable trade and decarbonization.

Keywords: China's economy; low-carbon technologies; carbon emissions (search for similar items in EconPapers)
JEL-codes: F14 F18 O44 Q56 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:92:y:2025:i:c:s1043951x25001038

DOI: 10.1016/j.chieco.2025.102445

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