“Evaluating Power Sector Emissions under China’s Regional Carbon ETS Pilots: A View from Space” (JMP) (latest version)

Abstract:  Tradable performance standard (TPS) is an important policy instrument for mitigating CO2 emissions in developing countries, who play an essential role in achieving drastic global carbon emissions reduction. Whether TPS effectively reduces firm-level emissions in the developing country context remains an unknown empirical question. This paper takes the first step in answering this question based on a policy experiment in China. Since 2013, China has introduced carbon emissions trading systems in eight regions based on TPS (ETS pilots). This study provides the first ex-post evaluation of the effects of these ETS pilots on emissions from coal-fired thermal power generation facilities using staggered and dynamic difference-in-differences models. This study uses a novel dataset from NASA’s Aura satellite to measure SO2 emissions at the facility level. Contrary to common belief, results show that although SO2 emissions of all facilities declined steadily from 2010 to 2019, SO2 emissions of facilities covered by the ETS pilots (ETS facilities) increased by about 5-7% relative to those of non-ETS facilities. Moreover, the relative increase in SO2 emissions of ETS facilities grew over time. A model is developed to show that the implicit output subsidy from the TPS design could increase the output of cleaner facilities, leading to more SO2 emissions.

Working Papers


“Measuring the Value of Rent Stabilization and Understanding its Implications for Racial Inequality: Evidence from New York City” (latest version), with Hancheng Jiang (University of North Texas) and Luis E. Quintero (Johns Hopkins University)

Abstract: Rent stabilization is valuable to occupying tenants because it limits rent growth. Assessing the rent discount implied by this policy is challenging because the counterfactual rents that rent-stabilized units would command in the unregulated market are unobservable. Using novel data from 2002 to 2017, we estimate the counterfactual rent and predict the quality-adjusted rent discount for each rent-stabilized unit in New York City (NYC). Results are notably robust to different empirical models, including propensity score and repeated rents with a panel of deregulated units. We find mean rent discounts of $410 per month ($4,920 per year), corresponding to 34% of the mean contract rents of rent-stabilized units. The aggregate size of the rent discounts in NYC is between 4 to 5.4 billion USD per year, roughly 10-14% of the federal budget on means-tested housing programs. Furthermore, we document the following stylized facts: (1) the value of rent stabilization increases linearly with housing tenure; (2) rent stabilization is not progressive; (3) rent discounts are consistently larger in Manhattan and increasing in neighborhoods with gentrification. Finally, we apply the estimated rent discounts to analyze racial inequality in the access to these benefits. We find that rent stabilization has disproportionately benefited White tenants. However, this gap has closed in recent years.


“Estimating the Learning Curve of the Chinese Onshore Wind Energy Sector”

Abstract: Onshore wind energy is emerging as a cost-competitive renewable energy source for developing countries. This study analyzes the role of learning based on the accumulation of experience and knowledge in promoting the rapid deployment of onshore wind technologies in China. Between 2005 and 2018, China has seen unparalleled growth in the cumulative installed capacity of wind energy from about one to 210 gigawatts. This rapid growth occurred in two episodes. Previous studies on learning in China’s wind energy sector have focused primarily on the growth episode before 2012. These studies have found moderate or negative learning rates (Qiu and Anadon, 2012; Tang and Popp, 2016; Lam et al., 2017; Hayashi et al., 2018). This study uses a novel project-level dataset obtained from the China Certified Emission Reduction (CCER) program to provide an update on the learning rates of onshore wind energy technologies during the second growth episode 2012-2015. Results show large learning rates of more than 20%, resulting from industry-wide spillovers.

Work in Progress

“Decomposing Energy Efficiency Progress in the Caribbeans and Latin America: The Role of Government Policies”, with Jevgenijs Steinbuks (World Bank)