Per capita CO2 emission inequality of China's urban and rural residential energy consumption: A Kaya-Theil decomposition

Abstract

With the increasing affluence, the differences in CO₂ emission between urban and rural residential sectors are remarkable and show an increasing trend. In case of China, residential sector accounts for a substantial share of the national CO₂ emission, bringing greater pressure to achieve the goal of carbon peak. Analyzing the emission inequality trend and its drivers is essential for formulating effective CO₂ emission reduction policies. However, the existing literature lacks relevant analysis from the viewpoint of urban-rural disparity. Hence, this study decomposes the CO₂ emission inequality of China's urban and rural residential consumption into four factors by combining the Theil index and Kaya decomposition. The results suggest that, in 2005-2020, the per capita CO₂ emission of rural residential consumption increased to a higher extent than those of urban households, with large differences in spatial distribution. Decomposition of the per capita CO₂ emission inequality for residential sector shows that the primary source is the inequality within the groups, mainly from the urban intra-group inequality. Based on the static decomposition, energy intensity appears as the main factor of urban-rural inequality. The dynamic decomposition shows that there have been differences in the factors of the change in the Theil index between urban and rural areas across sub-periods.

Keywords: CO(2) emission inequality; Index decomposition analysis; Theil index; Urban and rural residential consumption.