An analysis of the driving forces of CO2 emissions embodied in Japan-China trade

By using the latest China-Japan input-output data sets and the index decomposition analysis (IDA) approach, this article analyzes the driving forces of CO2 emissions embodied in trade between the two countries during 1990-2000. We found that the growth of trade volume had a large influence on the increase of CO2 emissions embodiments in bilateral trade. The dramatic decline in carbon intensity of the Chinese economy is a primary cause in offsetting CO2 emissions exported from China to Japan over 1995-2000. We argue that a better understanding of the factors affecting CO2 emissions embodied in international trade will assist in seeking more effective climate policies with wider participation in the post-Kyoto regime. (C) 2010 Elsevier Ltd. All rights reserved.