The effects of urbanization on CO2 emissions in the Pearl River Delta: A comprehensive assessment and panel data analysis

Urbanization has been viewed as an important factor in soaring energy consumption and rapidly increasing CO2 emissions, globally. While much existing literature has explored the effects of urbanization on CO2 emissions, little work has been undertaken to examine how differences in the urbanization process itself affect the impact that urbanization has on such emissions. In order to supplement the shortness of existing literature, this paper empirically investigates the multiple effects of urbanization on CO2 emissions, by addressing four different aspects of the urbanization process namely, economic urbanization, population urbanization, land urbanization, and social urbanization, and expects that these four aspects of urbanization will conduct multiple effects on CO2 emissions. A balanced city panel remote sensing and socioeconomic data and stepwise panel data model were used in the study, which examined the period of 1990-2013 in the Pearl River Delta, an economically developed region in China that has experienced rapid urbanization since the country's economic reforms. Our empirical results show that urbanization exerts two opposing effects on CO2 emissions: land urbanization and economic urbanization positively affects emissions due to transformation from non-built to built-up area and wealth accumulation respectively, while population urbanization exerts a negative impact on CO2 emissions as a result of improvement in energy consumption mode and efficiency. Social urbanization decreased emissions mainly through cultivating the awareness of energy-saving. Surprisingly, the industrial structure and social consumption had positive but not significant impacts on CO2 emissions in the Pearl River Delta. This finding suggests that urbanization, if measured by different indicators, does have different effects on CO2 emissions. In addition, we note the remarkable positive influence of energy intensity, indicating that lower energy efficiency tends to increase emissions. Furthermore, the impact of FDI was found to be positive, and R&D was not found to have performed any significant negative effect on CO2 emissions. These findings provide a useful insight into the relationship between urbanization and CO2 emissions that can support policy makers and urban planners.