Saudi Journal of Economics and Finance (SJEF)
Volume-10 | Issue-03 | 95-101
Original Research Article
Does China’s Carbon Intensity Decline with Economic Growth? Evidence from 1965–2024
Banyamin Moradi
Published : March 25, 2026
Abstract
China has high-speed development in the long term, while environmental protection is also given importance by society. The evidence of China can be analyzed and emulated by other countries. The project of ESG is popular globally, and the carbon intensity is considered an essential factor for the country, and economic growth may decrease the carbon intensity because economic growth is fueled by industry transition. The primary and secondary industries are not as efficient as the tertiary industry. This essay can give evidence to policymakers or independent units to make decisions under sustainable development. This study uses Stata software to conduct the analysis, and the analysis employs Chinese economic data and carbon-related data from world bank and the OWID CO₂ Dataset, respectively, from 1965 to 2024. The model chooses Carbon Intensity as the dependent variable and chooses Economic Growth as the independent variable. After that, the model employs Coal CO₂ Emissions per Capita, Services, Value Added (% of GDP), and Oil CO₂ Emissions as the Control Variables. From the empirical analysis, we can draw the conclusion that Economic Growth and Services, Value Added (% of GDP) are significantly associated with carbon intensity. And Coal CO₂ Emissions per Capita and Oil CO₂ Emissions are positively significantly associated with carbon intensity. China is an acute evidence for the developing countries to conduct an industry transition, and the carbon intensity decrease associated with a high-quality environment, which benefits all the citizens living in the country. The air conditioning and temperature also affect the earth ecosystem indirectly. China is still investing human, political, and capital resource to the tertiary industry and is accelerating the industry transition, which boosts its economic growth. Environmental protection should be put in the right place and be associated with the quality of living standards.