TY - JOUR
T1 - Carbon Pricing Induces Innovation: Evidence from China's Regional Carbon Market Pilots
AU - Cui, Jingbo
AU - Zhang, Junjie
AU - Zheng, Yang
PY - 2018/5
Y1 - 2018/5
N2 - China has launched seven regional pilots of emission trading scheme (ETS) to limit its carbon emissions. Taking advantage of the variations in the regional ETS pilots across regions and sectors and over time, we employ a difference-in-difference-in-differences (DDD) approach to evaluate the effect of ETS on low-carbon innovation at the firm level. Using patent application data of publicly-listed firms in China between 2003 and 2015, we find that the ETS pilots induced innovation in low-carbon technologies. The more active pilots—measured by carbon price and turnover rate of allowance trading—are associated with more intense low-carbon innovation.
AB - China has launched seven regional pilots of emission trading scheme (ETS) to limit its carbon emissions. Taking advantage of the variations in the regional ETS pilots across regions and sectors and over time, we employ a difference-in-difference-in-differences (DDD) approach to evaluate the effect of ETS on low-carbon innovation at the firm level. Using patent application data of publicly-listed firms in China between 2003 and 2015, we find that the ETS pilots induced innovation in low-carbon technologies. The more active pilots—measured by carbon price and turnover rate of allowance trading—are associated with more intense low-carbon innovation.
UR - https://www.aeaweb.org/articles?id=10.1257/pandp.20181027
U2 - 10.1257/pandp.20181027
DO - 10.1257/pandp.20181027
M3 - Article
SN - 2574-0776
VL - 108
SP - 453
EP - 457
JO - AEA Papers and Proceedings
JF - AEA Papers and Proceedings
ER -