How Environmental Trading Achieve the Synergistic Effects of Pollution and Carbon Reduction:Theoretical and Empirical Evidence
Emissions trading guidelines affect the production methods and emission reduction strategies of enterprises by releasing price signals of environmental elements.In the face of the incentive constraints of environmental trading,the behaviors and strategies adopted by enterprises also affect the effects of pollution and carbon reduction.On the one hand,in the short term,enterprises can promote pollution reduction through production cuts and end-of-pipe treatment.On the other hand,to produce a synergistic carbon reduction effect,enterprises need to adopt comprehensive emission reduction strategies such as energy input control,production process improvement,and R&D innovation.In addition,the synergistic carbon reduction effect of environmental trading will reduce the carbon market constraints by reducing the marginal cost of carbon emission reduction,which affects the efficiency of the carbon trading market.Thus,it is essential to investigate how to utilize the market mechanism of emission rights to promote the synergistic effect of pollution and carbon reduction,which is an important theoretical and practical issue in promoting the construction of beautiful China and the strategic goals of carbon peak and neutrality in a coordinated manner.Using the pilot emission trading of sulfur dioxide as a quasi-natural experiment of environmental trading,this study explores whether and how environmental trading can achieve the synergistic effect of pollution and carbon reduction by using the difference-in-difference method based on matched data from Chinese industrial enterprises,Chinese industrial enterprises'environmental statistics,and enterprise patent database.The study finds that emissions trading significantly reduces the total amount and intensity of sulfur dioxide and carbon dioxide emissions of enterprises,generating a synergistic effect of pollution and carbon reduction,which is stronger in mature or declining enterprises,state-owned enterprises,air-polluting industries,and in regions with lower economic development.The mechanism test reveals that emissions trading promotes pollution reduction through cleaner production and end-of-pipe treatment;emissions trading stimulates enterprises to substitute energy consumption and improve energy efficiency,which achieves pollution and carbon reduction synergy through the source reduction effect;and the synergistic path based on the innovation effect mainly comes from weak and strong Porter effects,which not only improves enterprises'technological innovation and product innovation capacity but also promotes pollution and carbon reduction synergistically by improving enterprises'total factor productivity.Further analysis reveals that emissions trading effectively enhances the degree of synergy between pollution and carbon reduction systems mainly by reducing the intensity of energy consumption.It also brings economic and social benefits while promoting pollution and carbon reduction,thus realizing the synergy of pollution and carbon reduction.In addition,the synergistic effect of emissions trading can lead to carbon quota over-issuance,and the carbon market needs to implement synergistic regulation on carbon quota allocation.This study provides a useful reference for integrating market-based instruments for environmental protection into the policy system of the dual carbon targets strategy and promoting the synergy of pollution and carbon reduction through market mechanisms.This study examines the effect and mechanism of sulfur dioxide emissions trading on sulfur dioxide and carbon dioxide emissions from both theoretical and empirical perspectives and tests whether the sulfur dioxide emissions trading system can realize the synergistic effect of pollution and carbon reduction.The conclusions of this study are of great significance in utilizing the market mechanism to promote the synergistic effect of pollution and carbon reduction,and the following policy recommendations are put forward.First,make full use of the environmental rights and interests trading market to synergistically promote pollution and carbon reduction.Second,strengthen the prevention and control of pollution and carbon emissions at source,and incentivize enterprises to carry out innovative activities.Third,improve the design details of the environmental rights and interests trading mechanism to promote the synergistic effect of pollution and carbon reduction according to local conditions.
Emissions TradingSynergies for Reducing Pollution and CarbonPorter EffectDual Carbon Targets