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The Achievement of Multiple Nationally Determined Contribution Goals and Regional Economic Development in China

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Abstract

In this paper, we develop a multiregional dynamic computable general equilibrium model, in which the technical details of the power sector are enriched by endogenizing nonfossil energy technological change. We then examine the impact of China’s carbon peaking and energy transition goals in 2030 on regional economic development. The results show that the carbon pricing policy will have a negative impact on the economy and aggravate the regional economic imbalance but will be conducive to total energy control. The targeted power investment policy promotes economic development and alleviates the regional economic imbalance; further, clean power investment also provides incentives for developing nonfossil energy technologies. It seems to be natural to achieve the carbon peaking and carbon intensity goals in 2030, whereas it will be more challenging to realize the total energy control and clean energy development goals. Targeted power investment adjusting combined with flexible carbon pricing does well in reconciling the attainment of multiple policy goals and the balance of reginal economic development.

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Notes

  1. The project of carbon peaking and carbon neutrality of 23 provincial administrative regions|Energy|Carbon emission|Carbon peak_Sina (sina.com.cn).

  2. Despite that the I-O table in 2017 has been released, the data quality of the province-level tables is not comparable with that of the national table, which prevents us from constructing a high-quality multiregional I-O table and making a credible SAM table for our CGE modelling work, we therefore still used the I-O table of 2012 in this paper.

  3. CGE models proceed under several typical assumptions, such as complete market clearing and perfect market competition, which may not hold in reality because of the existence of policy intervention and stickiness, which largely explains the model deviations.

  4. Resource endowment here mainly refers to the potential of renewables, like wind and photovoltaic resources. Broadly speaking, capital, labor and infrastructure that are beneficial for developing nonthermal technologies should also be included.

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Acknowledgements

We greatly thank anonymous referees for their valuable comments and suggestions, insightful comments from many peer scholars at the 6th China Energy and Environmental Economists Round-Table Forum are also acknowledged. We are grateful to the National Key Research and Development Program of China (Grant No. 2020YFA0608603), the National Natural Science Foundation of China (Grant No. 72022019, 72174190, 71874177, 71673263, 72274188), as well as the Fundamental Research Funds for the Central Universities for primary financial support of this work.

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Authors and Affiliations

  1. School of Public Policy and Management, University of Chinese Academy of Sciences, Beijing, 100049, China

    Yongna Yuan

  2. School of Economics and Management, University of Chinese Academy of Sciences, Beijing, 100190, China

    Guiyu Li & Hongbo Duan

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  1. Yongna Yuan
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  2. Guiyu Li
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  3. Hongbo Duan
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Correspondence to Hongbo Duan.

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Yuan, Y., Li, G. & Duan, H. The Achievement of Multiple Nationally Determined Contribution Goals and Regional Economic Development in China. Environ Resource Econ 84, 1155–1177 (2023). https://doi.org/10.1007/s10640-022-00752-4

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