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This study aims to provide an estimation of carbon dioxide (CO₂) emission abatement costs in China’s industry sector during the period of 2006-2010, and additionally provide an ex-post estimation of CO₂ abatement cost savings that would be realized if carbon emission permits trading among different industry sectors of 30 provinces in China during the same period were allowed, to answer the question that whether the industrial carbon emission abatement cost can (partially) be recovered from carbon emission trading in China.

The joint production framework associated with the environmental technology is utilized for formulating the models for estimating abatement costs and simulating emission permits trading scheme. Several data envelopment analysis-based models that could deal with both the desirable and undesirable outputs within the above framework are utilized for abatement cost saving estimation. The weak disposability assumption and variable returns to scale assumption are applied in the modelling.

In China’s industry sector, during 2006-2010, the estimated CO₂ emission abatement cost was 1,842 billion yuan, which accounts for 2.45 per cent of China’s total industrial output value; the emission abatement cost saving from emission permits trading would be 315 billion yuan, which accounts for 17.12 per cent of the emission opportunity abatement cost; and additional 1,065.95 million tonnes of CO₂ emission reductions would be realized from emission permits trading, and this accounts for 4.75 per cent of the total industrial CO₂ emissions.

The estimation is implemented at the regional level, i.e. the emission permits trading subjects are the whole industry sectors in different Chinese provinces, because of the data limitation in this study. Further estimation could be implemented at the enterprise level to provide a deeper insight into the abatement cost recovery from emission permits trading.

The estimation models and calculation process introduced in this study could be applied for evaluating the efficiency and effectiveness of pollutant emission permits trading schemes from the perspective that whether these market-based abatement policy instruments help to realize the potential abatement cost savings.

To the best of the authors’ knowledge, no study has provided the estimation of CO₂ emission abatement cost and the estimation of CO₂ abatement cost saving effect from emission permits trading for China’s industry sector. This study provides the first attempt to fill this research gap.

The purpose of the study is to investigate the financing channels and carbon emission abatement preferences of supply chain members, and further examine the optimal contract design of the retailer.

This paper develops a low-carbon supply chain composed of one retailer and one manufacturer, in which the retailer provides trade credit to the manufacturer. Considering the cap-and-trade regulation, the manufacturer with uncertain yield makes decision on whether to invest in emission abatement. There are bank loan and trade credit to finance production for the manufacturer and green credit to finance emission abatement investment. Meanwhile, the retailer may provide the manufacturer with three kinds of contracts to improve emission abatement efficiency, namely, revenue sharing, cost sharing or both sharing.

The results show that the retailer prefers to offer financing service at lower interest rate, but trade (and green) credit financing is always optimal for manufacturer and supply chain. The investment in emission abatement is value-added to all players. The sharing contracts offered by the retailer at lower sharing ratios can realize Pareto improvement of the system regardless of the financing scheme. However, comparing with the revenue or cost sharing contract, the existence of optimal sharing ratios makes the both sharing contract more favorable to the retailer.

The findings provide guidance for the emission-dependent manufacturer in financing and emission abatement decisions, as well as recommendations for the retailer to offer loan service and sharing contract.

This paper integrates green credit into bank loan or trade credit to analyze the financing decision of the manufacturer with uncertain yield and further considers the influence of three kinds of sharing contracts introduced by the retailer on improving operational performance.

Environmental resources and human knowledge are the ultimate foundations on which human welfare is based. The impact of technical knowledge is well researched. Denison, for example, attributes no less than 47 per cent of the growth of real GNP in the USA over the period 1948–81 to technical change. The importance of the environmental resource base has been brought to the foreground by studies like Limits to Growth. Nowadays environmental policies are applied in most industrialised countries just to prevent further deterioration of the environment. In these countries it is not the physical environmental constraint that is felt, but perhaps the drag on economic growth exercised by the costs of environmental regulation. Whatever the nature of the environmental limit to economic growth may be, physical or juridical, it can be overcome by the use and extension of knowledge in order to reduce the amount of pollution and the costs of pollution control. Technical advance or innovation in pollution control is and will remain a very important factor affecting the success of the efforts that are made to improve environmental quality and to maintain growth of output. In this article we shall give a survey of the economic research in the area of innovation and pollution control. The main research themes will be indicated, “blank spots” pointed out and suggestions made about possible subjects for fruitful future research. In section I a short introduction is given to the general economic approach to technical change and innovation. In section II the existing economic literature on pollution control and innovation is reviewed. It will be argued that some of the most relevant research themes have not been taken up. These issues will be discussed in sections III and IV. Section V contains conclusions and recommendations for future research.

There is great conflict between some developed countries and developing countries regarding attitudes toward reducing global warming (e.g. the USA vs China). The aim of this paper is to argue that open trade doesn't necessarily increase world pollution if clean development mechanism (CDM) is generously undertaken and if the CDM devotes considerable real resources in transfers of the associate abatement technology.

The impacts of trade on environment can be decomposed into scale, technique and composition effects. This paper incorporates abatement assets into Copeland and Taylor's model to argue that the technique effect stems from an increasing in pollution taxes and in international diffusion of abatement technology; however, the former is fully offset but the latter is facilitated by the CDM.

While world pollution is jointly determined by the composition and technique effects, in contrast to literature, open trade doesn't necessarily increase world pollution if CDM is generously undertaken with considerable real resources in abatement technology transfers.

Currently, there are more than about one half of the CDM projects that allocate no real resources in technology transfers. This study addresses how voluntary investment of the CDM from the North (e.g. the USA) to the South (e.g. China) might reduce pollution on a global level only if having “generously” technology transfer.

The purpose of this paper is to investigate whether truthful information sharing can be achieved via informal cheap talk in a competitive setting, and how carbon emission constraint and information-sharing modes (no information sharing, partial information sharing and public information sharing) interact with each other under cap-and-trade regulation.

This paper establishes an emission-dependent supply chain consisting of a manufacturer, an incumbent retailer who has superior demand information and a new entrant retailer. The manufacturer abates carbon emissions under the pressures of government environmental regulation and consumers’ eco-friendly concern. The research formulates a multistage game to explore every party’s decision and the implications of information-sharing modes.

The results show that truthful information sharing can be achieved when the manufacturer decides both the wholesale price and carbon emission abatement. The results also show that the incumbent retailer’s information-sharing decision highly depends on the manufacturer’s capacity in abating carbon emissions and the demand uncertainty.

The research adds value to information management and sustainable production literature. This work emphasizes the interaction between the information flow and material flow. Not only it investigates the factors that affect information-sharing modes from a new point of view when considering carbon emission constraint, but also provides operational strategies for manufacturers to make more profit when facing asymmetric information and emission regulation.

As a by-product of the production process, emissions can follow output fluctuations. Hence, disregarding the relationship between economic fluctuations and emissions could result in undesirable environmental outcomes. This study aims to investigate the environmental and economic effects of abatement subsidies on overall emissions during business cycles in Australia.

A real business cycle (RBC) model is devised and parameterised in this paper. RBC models have been recently introduced to environmental policy analysis, and this study contributes to the literature by investigating the effects of a potential subsidy policy in an RBC framework. The model is also calibrated and provides solutions for the Australian economy.

The authors find that under a steady-state situation, supporting abatement can result in reducing emissions by 6.45% while it imposes welfare costs to the economy (by 0.61%). Simulation results show that an optimal abatement policy should be pro-cyclical, with the abatement subsidy increasing during expansions and decreasing during recessions. As well, in a subsidy policy setting, emissions would react pro-cyclically, i.e. emissions increase (decrease) when the gross domestic product increases (decreases). The abatement reaction by firms, however, is different, because when a positive productivity shock occurs, firms reduce abatement and allocate resources to production. Nonetheless, as time passes, the increased subsidy provides a strong enough incentive to allocate resources to abatement and, subsequently, abatement increases.

This paper investigates how an emission reduction subsidy should be adapted to macroeconomic fluctuations so that it can limit variations in emissions.

We examine the effect of firm ownership status on three environmentally relevant variables: energy efficiency, toxic emissions, and spending on pollution abatement. Prior research has demonstrated that public firms invest less than private firms and suggests this difference is due pressure from investors to strongly favor short over long-term earnings. We extend this logic to other firm behavior, examining whether publicly owned facilities invest in energy efficiency and pollution reduction differently than privately owned facilities. Using data from the US Census of Manufactures from 1980 to 2009, information on pollution from the Environmental Protection Agency Toxic Release Inventory (TRI) and pollution abatement spending from the Pollution Abatement Costs and Expenditures survey, we find that facilities switching to public ownership are less energy efficient and spend less on pollution abatement than their privately owned counterparts. However, we also find that facilities switching to public ownership have lower toxic emissions than other facilities. We also examine how different sources of external pressures alter these results and find that increased regulatory scrutiny is correlated with increased energy efficiency, toxic emissions, and abatement spending. More concentrated institutional ownership in public firms is associated with lower energy efficiency as is a greater brand focus. These latter results are broadly consistent with the idea that publicly owned firms respond to pressures from investors with a reduced focus on environmentally relevant variables. However, since facilities switching to public ownership have lower toxic emissions, this suggests that there are two competing pressures in publicly owned facilities: cost pressures, consistent with lowered energy efficiency, and public perceptions, consistent with lower toxic emissions, particularly since TRI data became available. In this sense, the combination of ownership and transparency of information appears to influence how firms prioritize different stakeholders.

In August 2015, the Government Accounting Standards Board (GASB) adopted Statement 77, requiring government disclosure in audited financial reports of a particular type of tax expenditure, tax abatements. GASB's reporting standards move tax abatements from a budgetary environment to an accounting environment. This paper evaluates GASB 77's provisions to encourage an early and on-going dialogue about the Statement's prospects for achieving greater transparency compared to existing tax expenditure reporting efforts. We conclude that GASB 77 will be most beneficial to consumers of financial information in medium and large jurisdictions where there is no alternative tax abatement disclosure platform, or where the alternative offers less transparency than what can be achieved through financial reporting.

With more cities aiming to achieve climate neutrality, identifying the funding to support these plans is essential. The purpose of this paper is to exploit the present of a structured green bonds framework in Sweden to investigate the typology of abatement projects Swedish municipalities invested in and understand their effectiveness.

Marginal abatement cost curves of the green bond measures are constructed by using the financial and abatement data provided by municipalities on an annual basis.

The results highlight the economic competitiveness of clean energy production, measured in abatement potential per unit of currency, even when compared to other emerging technologies that have attracted the interest of policymakers. A comparison with previous studies on the cost efficiency of carbon capture storage reveals that clean energy projects, especially wind energy production, can contribute to the reduction of emissions in a more efficient way. The Swedish carbon tax is a good incentive tool for investments in clean energy projects.

The improvement concerning previous applications is twofold: the authors expand the financial considerations to include the whole life-cycle costs, and the authors consider all the greenhouse gases. This research constitutes a prime in using financial and environmental data produced by local governments to assess the effectiveness of their environmental measures.