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Conference Agenda

Overview and details of the sessions of this conference. Please select a date or location to show only sessions at that day or location. Please select a single session for detailed view (with abstracts and downloads if available).

Please note that all times are shown in the time zone of the conference. The current conference time is: 10th Sept 2026, 07:07:32pm CEST (Norway)

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Daily Overview

Session

Egg-timer session: Carbon leakage
Location: Auditorium J: Aina Uhde
Session Chair: Knut Einar Rosendahl, Norwegian University of Life Sciences

Presentation 6

Synergistic control of GHG and Air Pollutants under Carbon Market

Weiqi Tang^1,2, Boyang Xu³, Mingjian Dong⁴, Libo Wu^5,6,7,2

1: Fudan University, Fudan Development Institute, Shanghai, China; 2: Fudan University, Shanghai Institute for Energy and Carbon Neutrality Strategy, Shanghai, China; 3: Fudan University, School of Economics, Shanghai, China; 4: Fudan University, Department of Environmental Science and Engineering, Shanghai, China; 5: Fudan University, Institute for Big Data, Shanghai, China; 6: Shanghai Academy of AI for Science, Shanghai, China; 7: Shanghai Innovation Institute, Shanghai, China

Greenhouse Gases (GHG) and air pollutants share “common origin and source” as fossil fuel combustion. Reducing carbon emission can simultaneously reduce pollutant emissions, which is known as the environmental co-benefit of climate mitigation. However, the co-benefit is neither granted nor balanced on regional level, especially with carbon market. The trading mechanism of carbon market transfers carbon emission across regions, coupled with corresponding pollutant transfer, and can result in undesired and unbalanced regional environmental impacts. Fragmented regulation of pollutant emissions undermines the economic efficiency of the carbon market, since the two types of emissions are actually interlinked.

This paper shows that the two can be endogenously synergized. By rewarding emitters’ pollutant reduction with carbon quota or allowing offsetting carbon emission with pollution reduction credits, we can optimize pollution reduction incentives without compromising the cost-effectiveness of the carbon market. We prove it with a partial equilibrium model, and verify its validity in a complete economic representation with a general equilibrium model and real data of China. Furthermore, considering the incomplete information for policymakers, we propose a dynamic adjusting procedure, based on observable market variables, to approach the correct policy setting iteratively.

This study provides a reference for optimizing carbon market design, contributes to improving the environmental co-benefits of climate mitigation, and is beneficiary for encouraging developing countries to participate in global climate governance more actively.