Shadow prices of direct and overall carbon emissions in China’s construction industry: A parametric directional distance function-based sensitive estimation

Ke Wang, Kexin Yang, Yi-Ming Wei and Chi Zhang

Structural Change and Economic Dynamics, 2018, vol. 47, issue C, 180-193

Abstract: Construction industry, together with building materials industries supplying it, is one of China’s largest emitters of CO2. Structural change in construction industry has been promoted to mitigate CO2. This paper estimates CO2 shadow price of construction industry and its supporting materials industries in China so as to help them to mitigate CO2 cost-effectively. A parametric directional distance function model, taking into account all possible directional vectors, is applied to address issues regarding arbitrary selection of direction that will affect estimation of shadow price. Results show that there is larger potential for CO2 reduction in supporting material industries than in construction industry itself and shadow price of overall CO2 is much lower than that of direct CO2. The existence of enlarging heterogeneity in shadow prices among different regions provides strong support for introducing a national carbon trading market, thereby helping construction industry and building materials industries to reduce their abatement costs.

Keywords: Abatement cost; Building material industry; Construction industry; Shadow price (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0954349X18301176
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:streco:v:47:y:2018:i:c:p:180-193

DOI: 10.1016/j.strueco.2018.08.006

Access Statistics for this article

Structural Change and Economic Dynamics is currently edited by F. Duchin, H. Hagemann, M. Landesmann, R. Scazzieri, A. Steenge and B. Verspagen

More articles in Structural Change and Economic Dynamics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().