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Stability analysis of carbon emission trading mechanism in China based on a tripartite evolutionary game
Nanyu Chen1, Yanzhi Zhao2, Hongyu He3
1Shenyang University, Shenyang, 110044, China.
Abstract:
This study investigates the evolution and stability of China's carbon emission trading system, addressing disparities between China's carbon market development and international practices. By constructing a three-party evolutionary game model involving the government, enterprises, and consumers, this paper identifies key factors influencing system stability and offers policy recommendations. The main contributions include: (1) Developing a dynamic model that incorporates consumer behavior, including the herd effect, to reveal the interplay between demand-side dynamics and market evolution. (2) Demonstrating that government regulatory costs, consumer preferences, and enterprise investment costs significantly impact market stability and green transitions. (3) Highlighting that carbon prices alone have limited influence on enterprise participation, underscoring the importance of comprehensive incentives. This work provides actionable insights to optimize policy design, enhance market efficiency, and promote low-carbon transformation in China.
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