The effect of carbon emission trading scheme on energy efficiency: Evidence from China

The COVID-19 pandemic has caused a global economic recession and even changed its development pattern. Improving energy efficiency has become one of the best choices worldwide to achieve green recovery in the post-COVID-19 era. Therefore, this study explores the effect of carbon emission trading scheme (ETS) pilots on energy efficiency by the difference-in-differences (DID) model, using panel data of 30 Chinese provinces from 2009 to 2020. The following results are obtained: (1) Carbon ETS pilots could significantly increase energy efficiency by an overall effect of 1.82%, among which technical efficiency might be improved more obviously than others; (2) The average effect of carbon ETS pilots may differ between provinces because of some economic regional factors, being more significant in regions with a large number of employees and high wages; (3) This positive effect is transferred through industrial structure and R & D investment.(c) 2022 Economic Society of Australia, Queensland. Published by Elsevier B.V. All rights reserved.