Measurement And Analysis Of Energy Substitution Elasticity And The Effectiveness Of Carbon Tax Policy In China

With the rapid development of society and economy,the phenomena of excessive energy consumption and aggravated environmental pollution can not be ignored,and many measures to deal with the problems of resources and environment virtually are concrete manifestations of the implementation of energy substitution.This paper calculates and analyses the cross-price elasticity and the Morishima elasticity of substitution of inter-fuel and inter-factor in China from 1990 to 2016 by using translog cost function and seemingly unrelated regression method,and explores the effectiveness of carbon tax on carbon dioxide emission reduction based on substitutional relation.The results show that the self-price elasticity of coal and electricity is negative,while the self-price elasticity of oil in some years is positive due to the price is distorted compared with the normal level.Both oil and electricity are substitutional to coal,while oil and electricity are complementary in general.Among the three production factors of capital,labor and energy,except that the self-price elasticity of capital is positive due to market distortions in individual years,the self-price elasticity coefficients of the three factors are negative and that is to say their demand decreases with the rise of price.During the sample period,the overall relationship between capital and energy as well as between capital and labor is substitute,while the relationship between labor and energy always shows substitute,and the impact of change on labor’s price to the demand of energy is greater than that of change on energy’s price to the demand of labor.Compared with cross-price elasticity,the Morishima elasticity of substitution is more likely to show a substitution relationship.A carbon tax of RMB 50/tonne could reduce 434.58 million tonnes carbon dioxide emissions on the basis of 2016,which accounts for 5% of the total carbon dioxide emissions in that year.Carbon tax policy can effectively reduce carbon dioxide emissions,of which the main contribution comes from coal.Reducing the use of coal and increasing the use of low-carbon and clean energy can improve the energy utilization structure and accelerate the transformation and upgrading of the industry,which is of far-reaching significance for the sustainable development of green economy with energy conservation and emission reduction.