Does Factor Market Distortion Hinder The Improvement Of China’s CO₂Emission Efficiency?

In December2009, the Chinese government has made a commitment that the carbon dioxide emission per unit of GDP in2020will drop by40%to45%compared to2005, and took it as binding target for the long-term planning of economic and social development. However, Zou Ji et al.(2009) and SHI Minjun et al.(2010) have shown that under normal circumstances, by2020, our government’s commitment of emission reduction is not easy to achieve, and to achieve this emission reduction target, China will pay a huge economic costs. Therefore, improving the efficiency of carbon dioxide emissions in production and reducing the adverse impact brought by carbon dioxide emission reduction are the essential prerequisites of coordinating the development of economy and the sustainable development of environment.How to evaluate the present stage of carbon dioxide emission performance scientifically and objectively? What factors determine the efficiency of carbon dioxide emission? These have become hot issues in the environmental economics these days. Many literatures have launched an in-depth study, such as Wang Qun Wei et al (2010), Wei Mei et al (2010) and Hu Yuying (2010).In this paper, we firstly use SBM(Slack-Based Measure)model proposed by Tone (2004) to estimate the efficiency of CO2emission in provinces of China from1997to2007. The result of estimation shows that the efficiency of China’s carbon emissions as a whole is still at a relatively low level and there are significant regional differences. Then based on the fact that the process of the marketization of factor market lags behind that of products market and the factors market distortion index which was proposed by Zhang Jie (2011a), we use Tobit model and standardized regression method to study the relationship between factors market distortion and the efficiency of carbon dioxide emission empirically. Our findings are as follows:(1) factor market distortion hinders the improvement of efficiency of carbon dioxide emission of China and the difference among different regional’s efficiency of carbon dioxide emission is accounted largely for different marketization level of factor distortion;(2) Opening and urbanization is conducive to enhance the efficiency of carbon emissions and The proportion of state-owned enterprises、the consumption ratio of coal in total energy and the proportion of secondary industry have a negative impact on the improvement of the efficiency of carbon emissions.Therefore, taking really effective measure to promote marketization of factor market, eventually enhancing the degree of development of factor market in backward areas, can narrow the regional gap among efficiency of carbon dioxide emission in different regions and improve the overall efficiency of China which has important practical significance on the achievement of China’s carbon dioxide reduction in the premise of maintaining economic growth and is the only way to build a resource-saving and environmental friendly society.