Can climate mitigation help the poor? Measuring impacts of the CDM in rural China

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This study examines whether investment in climate change mitigation contributes to poverty alleviation. We investigate the impacts of the renewable energy-based clean development mechanism (RE-CDM) projects on rural communities in China. The impacts of RE-CDM projects are estimated by combining propensity score matching with the difference-in-differences approach. We found that the biomass-based CDM projects significantly contribute to income improvement and employment generation in rural communities in China. Our estimation results also reveal that wind energy-based CDM projects have the potential to increase income and the share of labor force in the primary industry in rural areas. These results suggest different channels through which renewable energy sources affect income.

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