Carbon leakage or carbon reduction? Carbon emission effect of the production relocation of metal smelting industry in China

Abstract The metal smelting industry (MSI) is one of the major carbon emission sectors in China, and it is of great significance to clarify the mechanism and truth of the carbon effect of production relocation (PR) of MSI for reducing national carbon emissions. Based on this thinking and previous studies, we proposed two concepts of relative carbon emission effect (RCE) and absolute carbon emission effect (ACE) of PR, then developed models to explore the impact of PR of MSI (PRM) on national carbon emission between 30 provincial administrative units in China from 2007 to 2017. The study demonstrates that the PRM and its ACE and RCE is divergent across provinces and regions. Overall, the PRM is beneficial to national carbon reduction under both relative and absolute scenarios. Specifically, the transfer‐in PRM of most provinces in central regions is beneficial to national carbon reduction, while the transfer‐out PRM of many provinces in coastal areas has worst carbon leakage effect.