The effect of low carbon transport pilot program on air quality in China

Abstract

The development model with a high dependence on fossil fuels has made China's environmental problems become more and more critical. At present, secondary pollutants represented by fine particulate matters have become the main problem in China's air pollution. In addition, the transportation system is one of the main sources of fine particulate matters. In order to reduce carbon emissions, the Chinese government carried out a low-carbon transport system pilot program in some cities. These low-carbon transformations may also have an impact on local air quality. Therefore, this paper utilized this program as a natural experiment, combined with a Difference-in-Differences model to weaken endogeneity problem, to capture Causal relationship between the low-carbon transportation transformation and local air quality. The empirical results in this paper find that low-carbon transport program can significantly reduce the concentration of fine particulate matters in the pilot areas, but have no effect on the SO2 emissions in the pilot areas. The subsequent NPV analysis finds that the program is costeffective and can generate an average net profit of 72 yuan GDP per capita. Based on the above analysis, this paper proposes some policy recommendations.