Assessing the carbon intensity of the heavy industry in China: Using a nonparametric econometric model

Abstract

Reducing the carbon intensity of the heavy industry is one of the main ways to achieve emission reduction goals. Most of the existing related studies use linear methods, which conceal the possible nonlinear relationship between carbon intensity and its influencing factors. The nonparametric models can address this deficiency. Thus, this paper uses this model to explore carbon intensity and obtains several novel results. (1) Energy consumption structure has a “pull first, then lower” inverted U-shaped nonlinear effect on carbon intensity, which means energy structure only plays a role in mitigating carbon intensity at a later stage. (2) The nonlinear impacts of incentive and mandatory environmental regulations exhibit an inverted U-shaped pattern. It is because in the later stage, the government invested more environmental governance funds and formulated more environmental laws. (3) Technological progress also has an inverted U-shaped effect, since R&D investment accelerates over time. (4) Similarly, the impact of foreign direct investment is an inverted U-shaped pattern, due to the introduction of more technologically advanced foreign investment projects in the later stage. (5) The impact of economic growth is more complex, showing an inverted N-shaped pattern. These findings have important policy implications. The above results have important policy implications.