Research on the articulated coupling effect of carbon tax policy under resource endowment in China

The carbon tax is a policy tool that internalizes external costs through a tax mechanism, which helps to reduce the consumption of fossil energy and lower carbon dioxide emissions. China, as the largest carbon emitter, introducing a carbon tax can further enhance the effectiveness of emission reduction. However, the introduction of a carbon tax may exacerbate contradictions in other aspects of the social system. To this end, the paper establishes a dynamic model of the carbon tax system by combining grey system theory and the IPAT model and then explores the coupling effect of the carbon tax on the economy, energy, and environment under the premise of China's resource endowment. It is found that carbon tax will not only distort consumer behavior but also aggravate the degree of capital market distortion. In the time-series simulation, it is found that the emission reduction efficiency of the carbon tax will show an oscillation decline. The carbon tax undermines the carbon peak target by dampening demand for energy consumption. In addition, we also find that the change of energy structure is the root of driving the failure of the "Jevons Paradox" and the realization of the "environmental Kuznets curve," and the panel data of energy and economy are only the manifestation of these two phenomena. China needs to adjust its energy structure to achieve its carbon peaking target. These results are helpful for policymakers to rationally view the carbon peaking target and formulate reasonable emission reduction policies.