The impact of China's carbon-reduction policies on provincial industrial competitiveness

China has gradually strengthened its carbon-reduction policies and measures in recent years. However, the impact of China's carbon policy on regional industrial competitiveness has received little attention. This paper proposed a method for calculating the intensity of carbon-reduction policies, and empirically analyzed the impact of China's carbon-reduction policy on provincial industrial competitiveness by using a panel regression model, and compared differences carbon policy impacting on competitiveness in three regions (East, Central, and West China) as well as four types of industry. Overall, the findings revealed that China's carbon-reduction policy harmed provincial industrial competitiveness (PIC). The carbon emission trading policy had a generally positive impact on PIC. The negative effect of carbon-reduction policies on industrial competitiveness in the eastern regions was relatively significant, while relatively minor in the central regions. The positive impact of the carbon emission trading policy on the industrial competitiveness of eastern regions was rather substantial, while it was relatively small in the western areas. The carbon-reduction policy harmed the provincial competitiveness of extractive industries, low-energy-consuming industries, and high-tech manufacturing industries. However, there was no discernible impact on high-energy-consuming industries. Finally, the carbon trading policy improved the provincial competitiveness of high energy-consuming industries. This research can aid in the optimization of China's carbon-reduction policy, as well as the coordination of provincial industrial development and the balance of different industrial development strategies.

Automated summary

China's carbon-reduction policies have negatively impacted provincial industrial competitiveness, with a significant effect in the eastern regions and a smaller effect in the central regions. The carbon emission trading policy has generally had a positive impact on industrial competitiveness. Different types of industries have been affected differently, with extractive, low-energy-consuming, and high-tech manufacturing industries experiencing harm to competitiveness. However, there has been no discernible impact on high-energy-consuming industries. The carbon trading policy has improved the competitiveness of high energy-consuming industries provincially.