Does China's air pollution abatement policy matter? An assessment of the Beijing-Tianjin-Hebei region based on a multi-regional CGE model

Abstract

This paper assesses the impact of China's air pollution abatement (APA) policies on both the economy and environment in the Beijing-Tianjin-Hebei (BTH) area, using a multi-regional energy-environment-economy computable general equilibrium (CGE) model incorporating the direct abatement expenditure of the proposed policies. The results show that, over the entire BTH area, the policies could generate an average annual loss of 1.4% of Gross Regional Product growth in the Action Plan scenario and 2.3% in the Enhanced Action Plan scenario. Moreover, realizing the 2020 PM2.5 BTH area concentration targets will not be possible in the Enhanced Action Plan scenario, even with a reduction in emissions of over 60% of sulfur dioxide, nitrogen oxide, and primary PM2.5 (particulate matter with an aerodynamic diameter less than 2.5 µm) and over 30% of VOCS (volatile organic compounds). End-of-pipe control is identified as the most cost-effective policy for most pollutant emission reductions, and that more joint measures are needed in future to address end-of-pipe control and reductions from vehicles in Beijing and Hebei, and VOC mitigation in Hebei. Market-based policies and incentive measures also need to be enhanced, with local governments’ expanding the development of environmentally friendly industry to upgrade industrial structure for economic growth.