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The process of carbon neutrality does have economic costs; however, few studies have measured the cost and the economic neutral opportunities. This paper uses a dynamic computable general equilibrium (CGE) model to simulate China's carbon neutrality path from 2020 to 2060 and analyzes its economic impact. This paper innovatively adjusts the CGE modeling technology and simulates the boundary of the Porter hypothesis on the premise of economic neutrality. The results show that the carbon neutrality target may reduce the annual GDP growth rate by about 0.8% in 2020–2060. To make the carbon pricing method under the carbon neutrality framework meet the strong version of the Porter hypothesis (or economic neutrality), China must increase its annual total factor productivity by 0.56–0.57% in 2020–2060; this is hard to achieve. In addition, the study finds that China's 2030 carbon target has little impact on the economy, but the achievement of the 2060 carbon neutrality target will have a significant effect. Therefore, the paper believes that the key to carbon neutrality lies in the coexistence of technological innovation and carbon pricing to ensure that we can cope with global warming with the lowest cost and resistance. [ABSTRACT FROM AUTHOR]

[Display omitted] • Taxing both firms and households may be more regressive than taxing just firms. • Taxing only energy firms could improve efficiency in carbon mitigation. • If energy firms pay carbon tax, energy processing firms need a tax cut. • Carbon policies can be designed by following the energy footprint. Previous research has generally concluded that carbon tax is regressive, despite its efficacy in reducing emissions. This paper takes a deeper dive to explore the validity of this assertion and proposes alternative approaches to enhance the efficiency of carbon tax without revenue recycling. Our argument asserts that the efficiency of a carbon tax can be determined by adjusting tax coverage. Furthermore, we find that taxing solely on energy production industries rather than the entire industry can significantly improve mitigation efficiency. Our findings also indicate that the carbon footprint and the emissions per unit cost for a given energy source account for the observed regressivity. Specifically, the wealthy consume commodities with higher carbon footprints, an indirect and invisible factor. However, it is important to note that the poor allocate a significantly greater proportion of their budget toward energy consumption, which is a visible and direct concern. Based on these findings, we provide several policy implications. [ABSTRACT FROM AUTHOR]

• A dynamic recursive multi-sector CGE model is applied for comprehensive analysis. • COVID-19 has a negative impact first on economy, then on energy system. • The COVID-19 reduces oil demand and price, limiting the development of renewables. • We should adjust the price gap between fossil and renewable in post-COVID-19 era. In 2020, the world experienced several significant events, including the COVID-19 pandemic and the collapse of international crude oil prices. Both have a great impact on a sustainable economy. Taking China as an example, we use a computable general equilibrium model with multi-sectors and multi-households and consider six different scenarios to simulate and evaluate the aggregate impacts of the pandemic and crude oil prices. We divide the impact of the pandemic into the changes of factor input and the changes of consumer preference and find that the decline of factor input is the leading cause of the economic downturn. The sharp drop in crude oil prices has a significant negative impact on the low-carbon economy. Although the pandemic has led to a decline in global carbon emissions, it is only because of the economic downturn. The epidemic situation and the change of oil price have double impacts on the economy, especially the sustainable economy. Adjusting the price gap between fossil energy and renewable energy (e.g., more stringent carbon pricing) and appropriate tax cuts on residents may be effective ways to alleviate the impact, which should be one of the environmental policies in the post-COVID-19 era. [ABSTRACT FROM AUTHOR]

The information industry leads the digital revolution and innovation. With regards to what economic impact the development of the industry will bring about, there has been minimal focus from literature. This paper fills the knowledge gap by using a dynamic computable general equilibrium model. The results show the development will rapidly promote economic development and social welfare, promote the reduction of commodity prices and the rise of output by providing higher social productivity. Finance, public service, and some traditional industry (such as electricity) will benefit more when the information industry develops rapidly. At present, the industry development of the information industry is more directed at the service industry and final consumption. This paper implies the information industry can strengthen R&D investment towards supporting finance, public services and traditional industries, such as industrial control embedded software products, cloud computing technology, and emergency communication for traditional industries to increase the income. [ABSTRACT FROM AUTHOR]

The coverage of Emission Trading Scheme (ETS) has been widely discussed. Based on the plans of the various stages of the National Development and Reform Commission in China, we explore the different impacts of different plans by applying recursive dynamic computable general equilibrium. What we found is different. Covering more industries, carbon prices will be lower so that the emission reduction motivation of each covering enterprises will be reduced. However, the resource attributes of carbon emission allowance will gradually emerge. In general, we found that the changes in the sectoral coverage will bring about the changes in the two effects in ETS market: carbon price effect and the allocation effect. The interaction of the two effects has led to a positive impact of both low-coverage and high-coverage on reducing emissions and improving the energy efficiency. This paper suggests that just covering three enterprises that are easy-to-MRV (monitoring, reporting, and verification) is enough for emissions reduction: cement, chemical and electric power, which can also achieve high emission reduction efficiency and can effectively reduce supervision cost. • A dynamic recursive CGE model is established in this paper. • There are two effects in ETS market: carbon price effect and the allocation effect. • Reduction efficiency is an inverted U-shaped curve to the changes of coverage. • Cement, chemical and electricity are encouraged to participate in ETS. [ABSTRACT FROM AUTHOR]

• A modified dynamic recursive CGE model is constructed. • Renewable energy growth is considerable only if ETS revenue is used. • Broader renewable energy subsidies are better than ones with narrow scope. • A small part of ETS revenue should be used to subsidize residents for social stability. Emission Trading Scheme (ETS) and renewable energy generation are emission reduction methods in most countries in the world. However, few studies have focused on the impact of ETS on renewable energy. The question is, can carbon trading promote renewable energy generation? This paper first analyzes different distribution strategies of ETS revenue by applying dynamic recursive computable general equilibrium model with multi-sectors. Practical scenarios and better options of distribution of ETS revenue by a comprehensive evaluation based on entropy weight method are proposed. The results show that ETS with no subsidy to renewable will reduce the demand for energy, increase the cost of renewable energy sources and decrease the generation. ETS will be the spring of renewable energy generation when most of the revenue is used for all kinds of renewable energy sources, instead of some of them. The growth of renewable energy generation is also substantial. It is necessary that a small portion of ETS revenue should be used to subsidize residents to reduce the gap between the rich and the poor. If this income is used for government investment and consumption, it will also help to mitigate economic losses, which is caused by the direction of investment by the Chinese government. [ABSTRACT FROM AUTHOR]