Chinese Economic Development and the Environment

Chinese Economic Development and the Environment

New Horizons in Environmental Economics series

Shunsuke Managi and Shinji Kaneko

Over the past two decades, China has become an economic powerhouse. However, as the world’s largest producer of CO2 emissions, the scale and seriousness of China’s environmental problems are clearly evident. This pioneering book provides an economic analysis of the significant environmental and energy problems facing China in the 21st century.

Chapter 7: Causal Direction Between Pollution Abatement and Environmental Efficiency

Shunsuke Managi and Shinji Kaneko

Subjects: asian studies, asian development, development studies, asian development, development economics, economics and finance, development economics, environmental economics, environment, asian environment, environmental economics


INTRODUCTION 1 Society faces an important tradeoff between economic output and environmental policy. Both environmental economists and public policy makers in developed and developing countries alike have shown a great deal of interest in the effect of pollution abatement on environmental efficiency. In line with the modern resources available nowadays, there has been a large amount of recent research, but no contribution to the environmental economics field with the Markov chain Monte Carlo (MCMC) application. MCMC techniques enable simulation from a distribution of a Markov chain and simulating from the chain until it approaches equilibrium. This simulation approach of probability density functions gained prominence through the practice of Bayesian statistics, which has the advantage over classical statistical methods in its simultaneous inference and incorporation of any prior information on all model parameters. The work we carried out concentrated on this point. In this chapter, we apply a Bayesian approach via MCMC simulation to the database of China, the largest developing country. China is the world’s third-largest consumer of coal and oil, but much of its energy-producing and -using equipment is both inefficient and highly polluting. As a result, China experiences severe urban air pollution which has a significant impact throughout the region. It is also the world’s second-largest source of greenhouse gas emissions. Improving energy efficiency and accelerating the development and application of new and renewable energy and clean coal technologies are therefore very urgent sustainable development and environmental priorities. Public policy makers are facing tradeoffs between economic growth and...

You are not authenticated to view the full text of this chapter or article.

Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.

Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.

Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.

Further information