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Carbon Efficiency, Carbon Reduction Potential, and Economic Development in the People"s Republic of China: A Total Factor Production Model

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The paper presents the findings of an empirical study that was conducted using provincial-level data from the 29 regions of People"s Republic of China in 2005. Carbon intensity as a traditional measure of an economy"s carbon performance is incapable of capturing the multidimensional features of an economy"s carbon performance. Particularly, since increased emissions have causes other than poor emitting technology, such as changes in the energy mix or the substitution of energy for labor. In order to overcome these shortcomings the study calculates the carbon performance based on Data Envelopment Analysis which measures carbon efficiency. Better carbon performance is associated with higher levels of economic development and greater resource endowments. The findings not only contribute to the research methodology, but also have important implications for national and international climate change policies.