The Forces Driving Inequalities in China’s Household Carbon Footprints

Discussion Papers

No.776

by Yuning Gao, Meng Li, Bo Meng, Jinjun Xue

March 2020

ABSTRACT

Household carbon footprints account for a large proportion of total emissions. When considering indirect emissions through the consumption of goods and services, a high level of carbon footprint inequality exists both worldwide and within China. Utilizing both provincial level input-output tables and micro-level household survey data, this paper aims to measure Chinese households’ indirect carbon footprints, estimate the level of indirect carbon footprint inequalities, and analyze the main drivers of carbon footprint disparities. The main findings are as follows. First, there is widespread inequality in terms of indirect carbon footprints at the individual household level, and the urban-rural disparity has a significant impact on carbon footprint inequalities. Second, inequalities in terms of carbon footprints are higher than those in relation to income and expenditure, with the main source being between-group inequalities. Third, disparities in income, education, living conditions, and asset ownership, as well as urban-rural disparities, are the main factors contributing to carbon footprint differentials. These results imply that the urban rich in China have contributed significantly to emissions growth by means of their daily consumption. With the largest population in the world, the reduction of China’s household carbon footprint has significant implications for global carbon emissions mitigation. China’s future policies should include consideration of low carbon emissions initiatives, such as a progressive carbon tax, that emphasizes the responsibility of the rich.

Keywords: carbon inequality, indirect carbon footprint, input–output analysis, China household survey data

JEL classification: Q54, Q56, C67, O15

©2020 by Institute of Developing Economies, JETRO and the Institute of Contemporary China Studies, Tsinghua University. No part of this publication may be reproduced without the prior permission of the IDE-JETRO and the Institute of Contemporary China Studies, Tsinghua University.