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ORIGINAL RESEARCH article

Front. Environ. Sci.
Sec. Environmental Economics and Management
Volume 12 - 2024 | doi: 10.3389/fenvs.2024.1407135
This article is part of the Research Topic Green Finance & Carbon Neutrality: Strategies and Policies for a Sustainable Future View all 32 articles

Studying the risk spillover effects of the carbon market and highcarbon-emission industries under economic uncertainty

Provisionally accepted
Jiatong Han Jiatong Han Qing Sun Qing Sun *Yanbo Jiang Yanbo Jiang
  • Tianjin University of Finance and Economics, Tianjin, Tianjin Municipality, China

The final, formatted version of the article will be published soon.

    In this paper, we select the China Carbon Market Price Index, which reflects the overall price changes in China's carbon market (CCM), andWith increasing global warming, global economic growth and sustainable development have been seriously affected, so investigating the spillover effects between the carbon market and high-carbon-emission industries is vital for achieving decrease of emissions and energy conservation. The paper employs the TVP-VAR-BK model to examine the risk spillover effects between the carbon market and high-carbon-emission industries in China from a frequency domain viewpoint. Employing the nonparametric quantile Granger causality test, it delves further into the effects of economic policy uncertainty (EPU) in China on the degree of risk spillovers between the carbon market and high-carbon-emission industries. There are significant risk spillover effects between the carbon market and high-carbon-emission industries. During the short term, the carbon market affects the cement industry more than the electric power and steel industries. However, the carbon market is affected by the volatility of the high-carbon-emission industries over the long term. In addition, the effect of EPU on the magnitude of risk spillovers between the carbon market and high-carbon-emission industries is nonsignificant at extreme quartiles and significant at the middle quartile level, which is typically asymmetric.

    Keywords: carbon market1, high-carbon-emission industries2, ow-carbon economy3, TVP-VAR-BK model4, spillover effects5, economic uncertainty6

    Received: 26 Mar 2024; Accepted: 30 Jul 2024.

    Copyright: © 2024 Han, Sun and Jiang. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY). The use, distribution or reproduction in other forums is permitted, provided the original author(s) or licensor are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.

    * Correspondence: Qing Sun, Tianjin University of Finance and Economics, Tianjin, 300222, Tianjin Municipality, China

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