The role of emissions trading mechanisms and technological progress in achieving China’s regional clean air target: a CGE analysis

Abstract

In this article, a multi-regional dynamic computable general equilibrium model is built to study the impacts of SO2 emissions trading and technological progress on the economy under the premise of achieving the targeted air pollution control objectives. The results show that, if air quality in the South and the Pearl River Delta reaches the national standard of level I, and other regions reach Level II by 2030 via implementing an emissions trading mechanism, the industry structure will be improved and CO2 emissions will drop 30–40% nationwide compared to the baseline scenario.