Anthropogenic carbon emissions and air pollutant emissions often share common sources. Designed to mitigate carbon emissions, an emission trading scheme (ETS) may also reduce air pollutant emissions, thereby generating health co-benefits from improved air quality. Nevertheless, such health co-benefits are often overlooked in ETS evaluations. This paper aims to bridge this research gap by quantifying the health co-benefits of the ETS resulting from the reduction of PM 2.5 and O 3 pollutions in China over the period from 2025 to 2060, using a Computable General Equilibrium (CGE) model. The model results indicate that both PM 2.5 and O 3 pollutions negatively impact labor input and thus economic output, with the impact of PM 2.5 pollution more pronounced than that of O 3 pollution. The ETS slightly alleviates the negative economic consequences of air pollution. Although the ETS incurs abatement costs, leading to a short-term reduction in GDP, this negative effect is relieved in the long term. Considering the health co-benefits derived from reduced air pollution, the negative economic consequences of the ETS are lessened, even though these co-benefits cannot fully offset the abatement costs.
Shuyang Chen (Thu,) studied this question.