The neoliberal policy experimentation on carbon emission trading in China

Abstract

China’s emission trading schemes are introduced as a prelude to a nationwide scheme. They allow authoritarian centralized control to strengthen, while making room for decentralization and business engagement. This article explores a mechanism that accommodates these contradictions. Our objective is to elaborate on the dynamic between centralizing and decentralizing forces. In China, the ongoing process of neoliberalizing climate change policies is organized around an institutionalized practice of policy experimentation. This practice has created conditions for stabilizing the existing structure of hierarchy. Primarily based on semi-structured interviews, our analysis reveals a number of system vulnerabilities linked to the uncertain and fragmented carbon markets, policies, and institutions. They problematize existing practices and allow the state to negotiate priorities and relations of power across scale. Pragmatic considerations about feasible solutions legitimize further intervention by the state and centrally coordinated policy measures. Key system vulnerabilities and the prospects for national-level action put these local policy experiments under a shadow of hierarchy. This article discusses one way in which local policy initiatives gain legitimacy while reinforcing hierarchical control. It advances the knowledge about China’s attempt to neoliberalize its climate change policies.