Driving technology factors of carbon emissions: Theoretical framework and its policy implications for China

Abstract

Empirical studies have widely examined the driving factors and methods to achieve a carbon peak; however, they seldom construct a theoretical framework and ignore the potential heterogeneity in technology. The most notable controversy is technology's different roles in carbon emissions. This study proposes an integrated theoretical framework considering the evolution of carbon emissions and presents the conditions for achieving a carbon peak. This framework shows that if the positive role of eco-friendly technology in decreasing carbon emissions is larger than the negative role of production-oriented technology in increasing carbon emissions; thus, carbon emissions do not increase (i.e. carbon peak). Additionally, this framework addresses the controversy concerning the effect of technology on carbon emissions. Our empirical results from a city-level panel dataset show that China is still moving towards achieving carbon emission reduction. Analysis of the driving mechanism reveals that production-oriented technology increases carbon emissions by increasing the production scale, consequently demanding more energy and emitting more carbon dioxide.

Keywords: Carbon emissions; Carbon peak; Eco-friendly technology; Theoretical framework.