Analysis of the transmission mechanism of carbon emissions trading on green investment

Abstract

This study describes the internal and external transmission mechanisms that the carbon emissions pricing program has on green investment. First, it is discovered that, depending on the underlying transmission mechanism, carbon emissions trading encourages or discourages investment in green projects due to factors like cost, technological advancement, and resource allocation. Second, based on the external transmission mechanism, carbon emissions trading encourages the development of green products and technological innovation in businesses, which effectively increases green investment. The experimental findings have prompted the proposal of countermeasures to offer empirical backing for the future growth of carbon emissions pricing and green investment in China.