Driving Factors and Growth Potential of Provincial Carbon Productivity in China

Abstract

Climate change has become a global concern, and the development of a green economy has attracted wide attention. Understanding the driving factors and growth potential of provincial-level carbon productivity is crucial for China’s green economic development in the new normal phase. In this study, the logarithmic mean Divisia index (LMDI) is adopted to systematically investigate the driving factors of provincial carbon productivity and explore the growth potential of provinces’ carbon productivity based on the clustering analysis. The results show that: (1) China’s provincial carbon productivity presents an increasing trend in 2001–2017, but the differences in carbon productivity among provinces are widening. (2) Economic activity and industrial structure are key to push up regional carbon productivity in China, while energy intensity is the main factor pulling it down. (3) The potential for carbon productivity improvement varies greatly among provinces in the four groups. Specifically, in groups 1 and 2, the developed provinces have little potential for improving carbon productivity, while the developing provinces in group 4 are just the opposite. These findings can enlighten policymakers that the development of a green economy should focus on optimizing and upgrading industrial structure and reducing energy intensity, and provincial heterogeneity must be considered when formulating green economic development policies.