Chunbo Ma

The shadow price of CO2 emissions in China's iron and steel industry

As China becomes the worlds largest energy consumer and CO2 emitter, there has been a rapidly emerging literature on estimating Chinas abatement cost for CO2 using a distance function approach. However, the existing studies have mostly focused on the cost estimates at macro levels (provinces or industries) with few examining firm-level abatement costs. No work has attempted to estimate the abatement cost of CO2 emissions in the iron and steel industry. Although some have argued that the directional distance function (DDF) is more appropriate in the presence of bad output under regulation, the choice of directions is largely arbitrary. This study provides the most up-to-date estimate of the shadow price of CO2 using a unique dataset of Chinas major iron and steel enterprises in 2014. The paper uses output quadratic DDF and investigates the impact of using different directional vectors representing different carbon mitigation strategies. The results show that the mean CO2 shadow price of Chinas iron and steel enterprises is very sensitive to the choice of direction vectors. The average shadow prices of CO2 are 407, 1226 and 6058Yuan/tonne respectively for the three different direction vectors. We also find substantial heterogeneity in the shadow prices of CO2 emissions among Chinas major iron and steel enterprises. Larger, listed enterprises are found to be associated lower CO2 shadow prices than smaller, unlisted enterprises.

The effects of off-farm work on fertilizer and pesticide expenditures in China

This study examines the effects of participation in off†farm work on farm expenditures on fertilizer and pesticide, using farm household survey data from China. Simple mean value comparisons reveal no statistically significant differences in fertilizer and pesticide expenditures between off†farm work participants and nonparticipants. However, econometric estimation with a treatment effects model shows a negative selection bias. After controlling for this bias, the empirical results show that participation in off†farm work exerts a positive and statistically significant impact on fertilizer and pesticide expenditures. Our findings generally suggest that the income effect of off†farm work stimulates agricultural production by increasing investments in productivity†enhancing inputs.

China's changing diet and its impacts on greenhouse gas emissions: an index decomposition analysis

With increasing awareness of agricultures contribution to global greenhouse gases (GHGs) and Chinas position as the worlds top GHG emitter, there is heightened attention to the embodied emissions in Chinas food consumption. Chinas diet has shifted to include more fruit, vegetables, meat and dairy. Not surprisingly, GHG emissions from food consumption have also increased substantially. This analysis links Chinas food consumption with the emissions of food production industries in China and its trade partners to determine the effects of dietary change on GHGs since 1989. We utilise high†resolution food production and emissions data to perform a logarithmic mean Divisia index decomposition to attribute changes in GHG emissions to the scale, supply structure, demand structure and efficiency effects resulting from Chinese dietary changes over a 20†year period. This study finds that while countries supplying food to China contribute little to Chinas food†related GHGs, demands for meat and dairy play a much larger role, driving up emissions. The overall scale of increased consumption of all food further propels growth in GHG emissions. Results indicate, however, that while food consumption in China more than doubles between 1989 and 2009 improvements in technological efficiency limit the rate of increase.

Organic farming : Does acquisition of the farming information influence Chinese apple farmers' willingness to adopt?

Purpose - The purpose of this paper is to explore the factors that influence Chinese apple farmers’ willingness to adopt organic farming, paying a special attention to the role of information acquisition. Design/methodology/approach - Given that the selection bias may occur when farmers themselves decide whether or not to acquire the information to understand the essence of organic farming, this study employs a recursive bivariate probit model to address the issue of the selection bias. Findings - The empirical results indicate that farmers’ decision to acquire information is positively affected by farmers’ environmental awareness, access to credit and access to information. In particular, information acquisition appears to increase the likelihood of farmers’ willingness to adopt organic farming by 35.9 percentage points on average. Practical implications - The findings suggest that measures increasing farmers’ information exposure can be promising policy interventions to induce adoption of organic farming. Originality/value - While considerable evidence indicates that organic farming provides more benefits than conventional production practice, little is known about farmers’ willingness to adopt in China. This paper provides a first attempt by examining the role of information acquisition in determining Chinese apple farmers’ willingness to adopt.

Estimating the cost of carbon abatement for China: Counting the Environment and Natural Resources

China is now the leading source of carbon emissions, and has become the subject of a growing number of studies attempting to estimate marginal carbon abatement costs using distance functions. Provincial-level data for China are used to estimate the functions using mathematical programming (deterministic frontier) and Bayesian methods (stochastic frontiers). Carbon abatement cost estimates are compared to values reported in the literature and to market prices for carbon. The Bayesian results are found to be lower and closer to observed market prices.

Capitalisation of residential solar photovoltaic systems in Western Australia

Due to government financial incentives and falling prices of photovoltaic (PV) systems, solar power has become the fastest growing renewable energy source in Australia. As financial incentives are being reduced or phased out, there is a possibility that adoption of this technology will slow down, thus creating a need for improved policy instruments targeted at adoption of residential PV systems. One of the factors affecting adoption of solar technology in the residential sector is its capitalisation in property values. Yet, the awareness of the capitalisation of PV investments in the Australian property market is limited. Our data indicate that homeowners who anticipate selling their properties in the near future are reluctant to adopt PV systems. This paper presents the first empirical estimate of the property price premiums associated with residential solar PV systems in Australia using residential property sales data from the Perth metropolitan area of Western Australia. An estimated 2.3–3.2 per cent property price premium associated with the PV systems suggests that homeowners fully recover the costs of PV investments upon the sale of their properties. Effective government policy could use this information to encourage adoption of residential PV systems by homeowners.