Combining global Malmquist-Luenberger index and generalized method of moments to investigate industrial total factor CO2 emission performance: A case of Shanghai (China)

Since the industry is economic backbone and the largest sector in energy-related CO2 emissions, whether it can coordinate industrial growth and CO2 emissions plays a vital role in achieving economic sustainable development. Using the global Malmquist-Luenberger (GML) index method, this paper estimates and decomposes the total factor CO2 emission performance (TFCEP, i.e., the environmentally sensitive productivity growth considering CO2 emissions as an undesirable output) of 32 industrial sub-sectors in Shanghai (China) over 1994-2011 for the first time. Furthermore, it adopts the system generalized method of moments (SGMM) to investigate the determinants of the TFCEP. We find that the environmentally sensitive productivity of overall industry in Shanghai keeps improved in recent years. Technical progress rather than efficiency promotion is the main contributor to ameliorate the TFCEP. Enhancing R&D intensity, optimizing energy consumption structure, and improving energy efficiency and labor productivity are beneficial to enhance the TFCEP, while capital deepening is the detriment of the TFCEP. Encouraging green technological innovation and adoption by combining the government intervention with market mechanism is significant to promote the TFCEP.