Technological progress on embodied carbon emissions in G7 countries’ exports: A structural decomposition analysis

As countries pay more attention to the issue of global warming, the solution of carbon emission reduction has important practical value. Most of the existing literature studied the driving factors of embodied carbon emissions. This paper creatively focuses on the impact of technological progress on embodied carbon emissions and on the embodied carbon emissions of different technology-intensive manufacturing industries, and aims to find out the important role of technological progress on embodied carbon emissions. This paper constructs a multi-regional input-output model based on the world input-output table, and analyzes and compares the changes in carbon emission intensity and export-implied carbon emissions of G7 countries from 2000 to 2014. This paper introduces the SDA model to investigate the impact of technology effects on the embodied carbon emissions of G7 countries' exports, and decomposes the technology effects into carbon emission technology effects and intermediate production technology effects. This study divides the manufacturing industries into low-tech, medium-low-tech, medium-high-tech and high-tech industries, and aims to examine the impact of technological progress effect on manufacturing with different levels of technology intensity. The empirical results reveal that, first, the carbon emission technical effect and the technical effect of intermediate production together constitute the technical effect. The carbon emission technology effect has a significant effect on suppressing the embodied carbon emissions of exports, while the impact of the intermediate production technology effect is relatively small, and the direction of action is uncertain. Second, the overall technological effect reduces the embodied carbon emissions of G7 countries’ exports, and offsets the embodied carbon emissions brought about by the scale effect to a certain extent. That is, technological progress can effectively reduce the embodied carbon emissions of exports. Third, technological effect has the most significant effect on the low- and medium-tech industries, and the low- and medium-tech industries are also the manufacturing industries with the most embodied carbon exports in G7 countries. Relevant policy recommendations for global carbon emission reduction are put forward at the end of this paper.