Economic Growth Of Chinese City Under Energy Conservation And Emission Reduction

The Fifth Plenary Session of the16th Communist Party of China (CPC) Central Committee clearly stated the goal of "building a resource-conserving and environment-friendly society", and for the first time put it as a strategic task in the long-term planning of the economic and social development. Since then, the government has adopted a series of policies and regulations relating to energy conservation and emission reduction, and has achieved some success. In November2012, then President Hu Jintao proposed in his report in the18th CPC National Congress, vigorously promoting the "ecological civilization." highlighted it in a prominent position, showing the country’s determination and confidence. to conserve resources and improve the environment.Over the years, China maintained a rapid growth nearing9%. However, growing resources waste, energy depletion and environmental pollution surged with the rapid growth, threatening the sustainability of China’s economic growth. At home, resources overexploitation and increasing environmental costs, particularly worsening smog have recently attracted attention of many scholars and other walks of life. According to statistics released in2013from China’s Ministry of Environmental Protection, China’s urban air quality is still heavily polluted or seriously polluted, with several cities such as Beijing above level of five or higher. According to the World Bank’s estimate in1996, China suffered approximately$54billion annual economic losses due to pollution, accounting for about8percent of GDP that year. Now, China m has become one of the world’s most apolluted countries and one of the world’s largest energy consumers and pollution emitters (Bolt et al.,2000). The situation should sound the alarm for our energy conservation and sustainable urban economic growth.Few scholars took an empirical study of quality of China’s urban economic growth. Therefore, this article constructed city-level databases, including resource and environmental elements into the framework of the tri-state analysis of economic growth environment, and use empirical methods to focus on economic growth under energy conservation constraint of the tri-state environment (gas-liquid-solid) with overall analysis, classification discussion and causes-seeking of the phenomenon.Research logic:It is common to study economic growth on the national and provincial level, but few studies have focused on urban economic growth in China. This paper mainly discusses Chinese urban growth under energy saving and emission reduction, according to the technical route of "characterization-category discussion-overall analysis". This paper studies the market efficiency and environmental efficiency of110major cities in China as economic growth, technological progress and foreign investment are important factors of a resource-conserving and environment-friendly society. Meanwhile, judging from the overall perspective, this paper analyses the relationship between China’s urban environment and economic growth, pointing out the way for future urban development. Contradiction between economic growth and environmental protection should be solved by efficient, rational environmental investments, and the environmental assessment of investment performance is a key issue. Then this paper offers policy recommendations to deal with the uneven distribution of pollutant emissions, imbalance of emissions and economic growth and investment.Methodology:this paper starts research measurement the performance of urban growth in China under the constraint of energy conservation to estimate the market efficiency and overall efficiency (or green efficiency and efficiency under environmental constraints) and its corresponding TFP. This paper extends two approaches based on use efficiency and productivity, one of which is based on the efficiency values to map "market efficiency-the overall efficiency of distribution" to get the development distribution of China’s110major cities, using a binary choice model to discuss the factors affecting urban transformation. Another application is to add equations to estimate the productivity of the environment, to reduce or resolve endogenous economic growth and environmental pollution problems and illustrate both economic growth and environmental pollution relationship. Finally, by building environmental pollution and its indicators with economic growth and investment environment, this paper gives the reasons for the phenomenon.The structure of the paper is organized as follows:1The literature review is given in chapter2. From the perspective of theoretical and the empirical analysis, this paper sorts and summarizes the literatures about the economic growth related with energy and environment. This paper shows two aspects associated with the relationship between economic growth and the environment:1) The calculation of the total factor productivity (TFP);2) the relationship between environment pollution and economic growth, which can also be named as environmental Kuznets curve or the resource hypothesis.2The empirical analysis of the relationship between the economic growth and the environment of the city is given based on the productivity. In the context of the literature review and the theoretical analysis, this paper analyzes the performance of the economic growth of the city under the constraints of the limited energy-use in China. Based on the industrial data of110major cities from2001to2011. this paper constructs the database of the environment index including the gas, liquids, and solids and then estimates the environment efficiency of the city and the total factor productivity by the method of slacaks-based sequential directional distance function. From this chapter, we obtain the Luenberger productivity index to describe the industry performance of the major cities, which is close to the reality environmental productivity situation.From this paper, we can conclude that:1) The average efficiency of the110major cities from2001to2011is0.705;2) the change of the average productive efficiency is0.0910, which can be de decomposed to efficiency change and technology change. The values of the two parts are0.0091and0.0819. respectively.3) This paper neglects that the effect of the energy consumption will underestimate the true efficiency and productivity; this paper also neglects that the pollution will overestimate the true efficiency and productivity; the input-output model without pollution control inputs will underestimate the true efficiency and productivity.4) In the major cities of China, reducing the emission of the pollution is more important than energy-saving.5) Technology is an important factor to improve the productivity, while the effect of energy and environment control is not clear.Third. China’s urban development model:based on market efficiency and overall efficiency perspective. With the based sequential directional distance function above this chapter estimates the efficiency value containing only market factors (ie, market efficiency), as well as comprehensively reflects the efficiency value (ie, the overall efficiency) of the market and environmental factors, using two sets of the level of efficiency values to build four urban development patterns. Among them, the high market efficiency and high overall efficiency characterize multiple factors relatively harmonious development, as a "two-oriented society" group. The results show that China has48cities out of110major cities scattered in the "low market efficiency and low overall efficiency group", and concentrated in the middle and western region; while there are39cities in the "high market efficiency and high overall efficiency group", and most are in the eastern region.To further examine the factors affecting urban transformation, we use a binary choice model to make empirical analysis, economic development, scientific and technological progress, the degree of openness are all promoting the urban transformation, namely toward double high level of market efficiency and overall efficiency; the variable characterizing resources abundance levels hinders urban development and transformation; effective investment channels, lack of investment management capabilities, extensive investment are difficult to become a driving force for development of urban transformation.Fourth, the "Environmental Kuznets" Curve:adding productivity to China’s urban environment and economic growth. Environmental and economic growth are closely related with environmental efficiency,"Environmental Kuznets" Curve discusses or exists endogenous problems. Using the above estimates of environmental productivity index, the chapter explores the "Environmental Kuznets"’Curve after taking into account environmental productivity in order to reduce the possible impact of endogenous relationship between the two. It is proven that no matter gas environment, and solid or liquid environments are consistently showing N shaped "Environmental Kuznets" Curve, which means as the economy grows, pollution level rises, and then decline to rise again. Meanwhile, it is determined that most Chinese cities are in the first phase of development, namely with economic growth rising pollutants rise phase. Resources are an integral part of the environment, in view of this, we also discussed the "Resource Curse", which is widespread and conducting through efficiency.Fifth, the effect analysis of China’s urban investment in energy saving and emission reduction. Indicators constructed found that China’s urban development exit three questions:namely pollution emission allocation imbalances, pollutant emissions and economic growth unfair, pollutant emissions and pollution control investment unreasonable. The difference between pollutant emissions and investment constitutes an important reason for the non-uniform relationship between the environment and economic development. By analyzing, this chapter explores the path of urban development and formation in order to make targeted policy recommendations for the different types of areas.Based on the empirical research as the main method China city economic growth,the possible contribution lies in:first, although the relationship between the literature research environment or resources and economic growth, but there is little literature using city data to validate. In this paper,we construct the city level economic growth framework, the emphasis on the relationship between environment and economic growth in three environmental conditions inclding gas, liquid and solid.multienvironmental research and confirm is the feature of this paper.Second, using the directional distance function to measure the efficiency and total factor productivity, the definition of Luenberger productivity index. Differ with the restraint of environment and environmental productivity, here on the basis of Luenberger productivity index additivity feature,we measure environmental productivity by the method of comprehensive productivity and market productivity difference. Intend to describe the change of environmental technology and environmental management accurately.Third, based on the market efficiency and comprehensive efficiency,we claimed "China citydevelopment mode" framework, and describe and analyze factors affecting Chinese city development transformation;Fourth, in the "environmental Kuznets curve hypothesis verification process,"endogeneity problem which exists between economic growth and environment can be overcomed by adding environmental productivity index.