Environmental Kuznets curve, balanced growth, and influencing factors: evidence from economic development in China

Abstract

Purpose The aggregate index and per capita index have different meanings for some countries or regions. CO2 emissions per capita matters for China because of its huge population. Therefore, this study aims to deepen the understanding of Kuznets curve from the perspective of CO2 emissions per capita. In this study, mathematical formulas will be derived and verified. Design/methodology/approach First, this study verified the existing problems with the environmental Kuznets curve (EKC) through multiple regression. Second, this study developed a theoretical derivation with the Solow model and balanced growth and explained the underlying principles of the EKC’s shape. Finally, this study quantitatively analyzed the influencing factors. Findings The CO2 emission per capita is related to the per capita GDP, nonfossil energy and total factor productivity (TFP). Empirical results support the EKC hypothesis. When the proportion of nonfossil and TFP increase by 1%, the per capita CO2 decrease by 0.041 t and 1.79 t, respectively. The growth rate of CO2 emissions per capita is determined by the difference between the growth rate of output per capita and the sum of efficiency and structural growth rates. To achieve the CO2 emission intensity target and economic growth target, the growth rate of per capita CO2 emissions must fall within the range of [−0.92%, 6.1%]. Originality/value Inspired by the EKC and balanced growth, this study investigated the relationships between China’s environmental variables (empirical analysis) and developed a theoretical background (macro-theoretical derivation) through formula-based derivation, the results of which are universally valuable and provide policymakers with a newly integrated view of emission reduction and balanced development to address the challenges associated with climate change caused by energy.