Policy Coordination Effects of APPCAP and ETS on Pollution and Carbon Reduction

Na Liu (), Siyue Yang, Xinwei Gao and Ruirui Yang
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Na Liu: International Business School, Qingdao Huanghai University, Qingdao 266427, China
Siyue Yang: School of Public Policy and Administration, Northwestern Polytechnical University, Xi’an 710072, China
Xinwei Gao: School of Economics and Management, China University of Petroleum (East China), Qingdao 266580, China
Ruirui Yang: School of Economics and Management, China University of Petroleum (East China), Qingdao 266580, China

Energies, 2024, vol. 17, issue 23, 1-22

Abstract: Coordinated control of pollution and carbon reduction is an imperative choice for China’s overall transition towards sustainability. However, China’s environmental policies often treat pollutants and CO 2 separately, potentially resulting in imbalanced pollution and carbon reduction. Since several cities are not only critical cities for the Air Pollution Prevention and Control Action Plan (APPCAP) policy but also pilot cities for the Carbon Emissions Trading Scheme (ETS), this study aims to examine the extent to which the policy coordination of APPCAP and ETS can influence air pollutants and CO 2 emissions. Using panel data from 2011 to 2019 for China’s 231 prefecture cities, we compare the pollution and carbon reduction effects of separate and coordinated policy implementation of APPCAP and ETS via the difference-in-differences (DID) model and the causal forest model. Research shows that (1) the policy coordination of APPCAP and ETS has significantly reduced both air pollutants and CO 2 emissions in dual-policy pilot cities. For non-dual pilot cities, the separate implementation of APPCAP or ETS only exerts significant unilateral effects. (2) Enhancing government supervision, weakening the relationship between government and enterprises, and raising enterprises’ green innovation capabilities are the main mechanisms through which policy coordination can significantly influence pollution and carbon reduction. (3) The combined implementation impacts of APPCAP and ETS are more evident in pollution-intensive cities and cities with weak carbon-peaking trends. Our research inspires the development of a collaborative system of pollution reduction and carbon reduction policies.

Keywords: air pollution prevention and control action plan; carbon emissions trading scheme; policy coordination; pollution and carbon reduction (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2024
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