|Address:||G5703, 5/F, Yeung Kin Man Academic Building (YEUNG),
City University of Hong Kong,
Tat Chee Avenue, Kowloon, Hong Kong SAR
Boya Distinguished Professor of Economics and Associate
Dean National School of Development, Peking University
Since accession of WTO in 2002, China’s export and annual GDP growth has accelerated, so has environmental aggravation, triggering the “pollution haven” debate. Using synthetic control method, this paper first examines the “pollution haven effects” by comparing carbon emission changes in China and its major trade partner countries due to China’s WTO accession. The effects are found to be strong between China and the major trading partners. To further understand the reason behind the effects, this paper investigates export growth by sectors and calculates carbon footprints for the leading export sectors. Our analyses indicate that some capital-intensive sectors lead the export growth after the WTO entry. Our calculations of carbon footprints also show that these leading capital intensive export sectors have much higher carbon footprints. Lastly, this paper conducts growth accounting to learn about drivers of export growth. The results indicate that environmental factors represented by carbon footprints contribute more after WTO accession, substituting for TFP growth. On the other hand, contribution of capital declines and contribution of labor is not significant. To sum up, China’s economic growth in the past two decades can be largely attributed to sacrificing the environment. This pattern is exacerbated by WTO accession. Changing economic growth pattern requires raising the prices of environmental factors which will shift the economic growth path toward one more driven by TFP growth.
Jintao Xu is the Peking University Boya Distinguished Professor of Economics and associate dean at National School of Development, Peking University. He is also the director of PKU’s China Center for Environmental and Energy Economics (CCEEE). His recent researches rang from assessing forest tenure reform in China, industrial pollution control policy, economic policy toward a low carbon economy, to transportation management in Beijing, etc. His publications appear on American Journal of Agricultural Economics (AJAE), Journal of Environmental Economics and Management (JEEM), Land Economics, World Development, Environment and Development Economics, and Ecological Economics.
Jintao Xu currently serves as associate editor of the European Journal of Agricultural Economics, and was associate editor of American Journal of Agricultural Economics and was on editorial board of Journal of Environmental Economics and Management.
He obtained his bachelor of engineering degree in 1984 from Jilin University of Technology, master in forest economics in 1988 from Beijing Forestry University, and later MA in economics (1996) and Ph.D. in natural resource economics (1999), both from Virginia Tech.
Jintao Xu teaches environmental economics and advanced natural resource economics at Peking University.