Economy and Policy

Jing Cao, Mun S. Ho, Dale W. Jorgenson, and Chris P. Nielsen. 2019. “China’s emissions trading system and an ETS-carbon tax hybrid.” Energy Economics, 81, Pp. 741-753. Publisher's VersionAbstract
China is introducing a national carbon emission trading system (ETS), with details yet to be finalized. The ETS is expected to cover only the major emitters but it is often argued that a more comprehensive system will achieve the emission goals at lower cost. We first examine an ETS that covers both electricity and cement sectors and consider an ambitious cap starting in 2017 that will meet the official objective to reduce the carbon-GDP intensity by 60-65% by 2030 compared to 2005 levels. The two ETS-covered industries are compensated with an output-based subsidy to represent the intention to give free permits to the covered enterprises. We then consider a hybrid system where the non-ETS sectors pay a carbon tax and share in the CO2 reduction burden. Our simulations indicate that hybrid systems will achieve the same CO2 goals with lower permit prices and GDP losses. We also show how auctioning of the permits improves the efficiency of the ETS and the hybrid systems. Finally, we find that these CO2 control policies are progressive in that higher incomes households bear a bigger burden.
Jing Cao, Mun S Ho, and Wenhao Hu. 2019. “Energy consumption of urban households in China.” China Economic Review, 58, 101343. Publisher's VersionAbstract
We estimate China urban household energy demand as part of a complete system of consumption demand so that it can be used in economy-wide models. This allows us to derive cross-price elasticities unlike studies which focus on one type of energy. We implement a two-stage approach and explicitly account for electricity, domestic fuels and transportation demand in the first stage and gasoline, coal, LPG and gas demand in the second stage. We find income inelastic demand for electricity and home energy, but the elasticity is higher than estimates in the rich countries. Demand for total transportation is income elastic. The price elasticity for electricity is estimated to be −0.5 and in the range of other estimates for China, and similar to long-run elasticities estimated for the U.S.
Jing Cao, Mun S. Ho, Yating Li, Richard G. Newell, and William A. Pizer. 2019. “Chinese residential electricity consumption estimation and forecast using micro-data.” Resource and Energy Economics, 56, Pp. 6-27. Publisher's VersionAbstract
Based on econometric estimation using data from the Chinese Urban Household Survey, we develop a preferred forecast range of 85–143 percent growth in residential per capita electricity demand over 2009–2025. Our analysis suggests that per capita income growth drives a 43% increase, with the remainder due to an unexplained time trend. Roughly one-third of the income-driven demand comes from increases in the stock of specific major appliances, particularly AC units. The other two-thirds comes from non-specific sources of income-driven growth and is based on an estimated income elasticity that falls from 0.28 to 0.11 as income rises. While the stock of refrigerators is not projected to increase, we find that they contribute nearly 20 percent of household electricity demand. Alternative plausible time trend assumptions are responsible for the wide range of 85–143 percent. Meanwhile we estimate a price elasticity of demand of −0.7. These estimates point to carbon pricing and appliance efficiency policies that could substantially reduce demand.


April 8, 2019


英文原文由Leah Burrows撰写。

如果想要实现《巴黎气候协定》的目标将全球气温升幅控制在前工业水平以上2摄氏度以内,那么仅仅依靠诸如风能和太阳能这种碳中和能源是远远不够的,使用负碳技术包括负碳能源来切实减少大气中的二氧化碳水平将是必不可少的。... Read more about 中国的负碳发电

2019 Mar 07

China and Asia in a Changing Climate: Natural Science for the Non-Scientist

12:15pm to 1:45pm


CGIS South S020, Belfer Case Study Room, 1730 Cambridge St., Cambridge, MA




  • Professor John Holdren, Teresa and John Heinz Professor of Environmental Policy, Harvard Kennedy School (HKS) and Department of Earth and Planetary Sciences, Harvard University; Co-Director of Science, Technology, and Public Policy Program, HKS; former Science Advisor to President Barack Obama and former Director of the White House Office of Science and Technology Policy
  • Professor Peter Huybers, Department of Earth and Planetary Sciences, Harvard University, and Harvard John A. Paulson School of Engineering and Applied Sciences
  • Professor Elsie Sunderland, Gordon McKay Professor of Environmental Chemistry, Harvard John A. Paulson School of Engineering and Applied Sciences and Harvard T.H. Chan School of Public Health
  • Professor Steve Wofsy, Abbott Lawrence Rotch Professor of Atmospheric and Environmental Science, Department of Earth and Planetary Sciences, Harvard University, and Harvard John A. Paulson School of Engineering and Applied Sciences

Chair: Professor Mike McElroy, Gilbert Butler Professor of Environmental Studies, Department of Earth and Planetary Sciences, Harvard University, and Harvard John A. Paulson School of Engineering and Applied Sciences; Chair, Harvard-China Project on Energy, Economy and Environment... Read more about China and Asia in a Changing Climate: Natural Science for the Non-Scientist

Lin Zhou, Jianglong Li, Yangqing Dan, Chunping Xie, Houyin Long, and Hongxun Liu. 2019. “Entering and exiting: Productivity evolution of energy supply in China.” Sustainability, 11, 983. Publisher's VersionAbstract
The continuous entry of new firms and exit of old ones might have substantial effects on productivity of energy supply. Since China is the world’s largest energy producer, productivity of energy supply in China is a significant issue, which affects sustainability. As a technical application, this paper investigates the productivity and dynamic changes of Chinese coal mining firms. We find that the total factor productivity (TFP) growth of coal supply in China is largely lagging behind the growth rate of coal production. The entry and exit of non-state-owned enterprise (non-SOE) partially provide explanation for the dynamic change of aggregate TFP. Specifically, non-state owned entrants induced by the coal price boom after 2003, which had negative effects on TFP of energy supply, while the exit of non-SOEs had positive effects. Furthermore, there is regional heterogeneity concerning the effects of entry and exit on energy supply productivity. More entrants induced by coal price boom are concentrated in non-main production region (non-MPR), while more exits are located in MPR due to the government’s enforcement. This provides explanation for the phenomena that productivity of energy supply in MPR gradually surpasses that in non-MPR. We also anticipate our paper to enhance understanding on the energy supply-side, which might further help us make informed decisions on energy planning and environmental policies.
Xiaolin Guo, Mun Sing Ho, Liangzhi You, Jing Cao, Yu Fang, Taotao Tu, and Yang Hong. 2018. “Industrial Water Pollution Discharge Taxes in China: A Multi-Sector Dynamic Analysis.” Water, 10, 12, Pp. 1742. Publisher's VersionAbstract
We explore how water pollution policy reforms in China could reduce industrial wastewater pollution with minimum adverse impact on GDP growth. We use a multi-sector dynamic Computable General Equilibrium (CGE) model, jointly developed by Harvard University and Tsinghua University, to examine the long-term impact of pollution taxes. A firm-level dataset of wastewater and COD discharge is compiled and aggregated to provide COD-intensities for 22 industrial sectors. We simulated the impact of 4 different sets of Pigovian taxes on the output of these industrial sectors, where the tax rate depends on the COD-output intensity. In the baseline low rate of COD tax, COD discharge is projected to rise from 36 million tons in 2018 to 48 million in 2030, while GDP grows at 6.9% per year. We find that raising the COD tax by 8 times will lower COD discharge by 1.6% by 2030, while a high 20-times tax will cut it by 4.0%. The most COD-intensive sectors—textile goods, apparel, and food products—have the biggest reduction in output and emissions. The additional tax revenue is recycled by cutting existing taxes, including taxes on profits, leading to higher investment. This shift from consumption to investment leads to a slightly higher GDP over time.
Summer RA


September 26, 2018

A Harvard Gazette article by Al Powell



Read more about 哈佛中国项目组织本科生暑期赴中国参与环境问题研究


August 14, 2018

由于在真实世界里人们几乎无法通过控制数目庞大的变量来创造理想的实验条件,因此想要在社会科学领域进行对照实验几乎是不可能的。然而,在一些偶然情况下,某些政策效果却无心插柳地创造出了一个类实验情境,这种情况被称为自然实验。当北京的车辆限行政策遇上中国人对数字4不吉利寓意的忌讳心理时,自然实验的条件就产生了 — — 哈佛大学中国项目的曹静教授和她的团队抓住了这一千载难逢的机会,顺势就北京空气污染对健康的影响这一课题展开研究。他们已将研究结论整理成论文发表于 Journal of the Association of Environmental and Resources Economists (JAERE)... Read more about 评论:其实4也可以是个幸运数字?中国人对数字4的忌讳心理居然可以用来研究北京空气污染对健康的影响