Structural path decomposition of carbon emission: A study of China's manufacturing industry

Manufacturing is the foundation of China's economy and accounts for a large proportion of China's CO2 emissions. In this study, the structural path decomposition (SPD) methodology, based on an environmental input-output model, was used to find critical supply chain paths that drive changes in CO2 life cycle in China's manufacturing industry from 1992 to 2012. The changes in CO2 emissions were decomposed into three main factors: carbon emissions intensity, input-output structure, and final demand. In this study, the “weighted average decompositions” method of structural decomposition analysis and the non-comparable input-output table were first applied to the SPD method to obtain accurate results. The results indicate that higher-order paths, especially the paths that started from the “Smelting and Rolling of Metals” and the “Production and Supply of Electricity and Steam” sectors, led to an increase in carbon emissions. This was mainly due to the extension of the industrial chain as well as policy priorities. Moreover, CO2 emissions from the “Chemical Industry”, “Manufacture of Nonmetallic Mineral Products”, and “Smelting and Rolling of Metals” sectors were mainly induced by the increase of final export demands. Based on the results of this study, relevant policy changes have also been recommended.