Can Emissions Trading Scheme Achieve the Porter Effect in China?
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| Title | Can Emissions Trading Scheme Achieve the Porter Effect in China?
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| Author | Tu Zhengge and Shen Renjun |
| Organization | School of Economics and Business Management, Central China Normal University |
| Email | tuzhengge@163.com；shenrenjun@yeah.net |
| Key Words | Emissions Trading; Porter Hypothesis; DEA Model; Difference-in-difference Method |
| Abstract | “We need golden and silver hill as well as clean water and green mountains”. It means China should achieve the Porter effect which states a win-win development of creating economic gains and environment gains simultaneously in the “New Reforms”. It is the major prerequisite for Porter Hypothesis to promote technology innovation by reasonable and strict environmental policy. This paper evaluates the Porter effect of China’s industrial SO2 emissions trading pilot scheme (SETPS) with environmental regulation and other conditions remaining constant. Our findings are that China’s industrial SETPS could play a certain role in relieving the serious configuration inefficiency problem of emission rights, but it failed to achieve the Porter effect in both the short and long term. An inefficient market and a weak environmental regulation hadn’t matched a “perfect” SETPS in China. Efficient market construction and strong environmental regulation to form inside and outside “Double Engines” of market and government are necessary conditions for achieving the Porter effect. |
| Serial Number | WP930 |
| Time | 2015-10-08 |
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