Page 33 - Special Topic Session (STS) - Volume 2

STS452 Yang C. et al.
1. Background
The problem of global warming caused by the consumption of fossil
energy has become a social focus all over the world. In recent years, with the
globalization of trade and production, international trade carry a large amount
of carbon dioxide embodied in the goods production chain. According to WTO
data, the total value of global exports of goods in 1990 was only 3449 billion
USD, and in 2017 it has reached 17729 billion USD, with an increase of more
than 5 times. The accompanying problems of environmental pollution with the
international trade have become increasingly prominent. Under this
circumstance, there has been a rapid increase in the study of trade embodied
carbon emissions of different countries (Wyckoff and Roop, 1994; Ahmad and
Wyckoff, 2003; Peters and Hertwich, 2006; Weber and Matthews, 2007; Peters
et al., 2011; Liu et al., 2016; Deng and Xu, 2017).
Specifically, with the rapid development of the economy, China has
become one of the largest CO2 emitters in the world, and also one of the
countries with the greatest energy consumption. At the same time, since the
implementation of the reform and opening up policy, China’s foreign trade
has developed rapidly. In 2017, China's foreign trade amounted to USD 4105
billion, ranking the first in the world. The gross export amounted to USD 2263
billion, accounting for 12.8% of the total world exports. China, as a big country
in the world trade, produces a large amount of embodied carbon emissions
from a large number of energy-intensive products. How to effectively reduce
trade-embodied carbon emissions in China has aroused wide attention of
government, experts and scholars all over the world. There has been a large
number of domestic and foreign scholars carried out research on China's trade
and carbon emissions (Weber et al., 2008; Yunfeng and Laike, 2010; Zhao and
Liu, 2011; Su and Ang, 2014; Zhao et al., 2016; Huang and Zhao, 2018).
However, the existing studies exploring the China’s trade-embodied
carbon emissions are based on the national level or the industry level, which
lack of in-depth research from the firm level. In fact, although all the policies
such as foreign trade and carbon emission reduction are carried out by
government, they have to rely on the specific implementation of firms, so it is
essential to start from the firm level to solve these problems from bottom to
top. However, there are obvious differences in production structure,
technology level, import and export trade, energy consumption, carbon
emissions and economic impact among different types of firms, so to a large
extent, the implementation of a trade or emission reduction policy will
produce different feedbacks for different types of firms. Especially with the
rapid development of the China’s economy, many kinds of diversified firms
have been cultivated. Therefore, it is extremely necessary to study trade and
carbon emission from the perspective of firm heterogeneity.

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