Journal of Applied Finance & Banking

How Does International Crude Price Affect China’s Carbon Emission?

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  • Abstract

     

    This study extends the standard STIRPAT model by introducing an energy price factor and uses the extended STIRPAT model to examine the effect of international crude oil prices on China’s carbon emission, This paper applies Ridge regression to conduct empirical analysis. The study finds that changes in international crude prices have a significantly positive impact on China’s carbon emission. A 1 percent increase in international crude oil price leads to a 0.12 percent increase in China’s carbon emission This finding remains unchanged even after a set of control variables are included in the analysis and survives all the rigidity tests.

     

    Keywords: Crude price, China, Carbon emission.