CO₂ emissions and expansion of railway, road, airline and in-land waterway networks over the 1985–2013 period in China: A time series analysis

China, the world's largest CO₂ emitter, is continuing its long-term strategy to use transportation investments as a tool for development. With the expectation that transportation will contribute 30–40% of the total CO₂ emissions in China in the near future, there is an imminent need to identify how the development of different transportation modes may have different long-term effects on CO₂ emissions. Using time series data over the period of 1985–2013, this paper applies the combined autoregressive distributed lag (ARDL) and vector error correction model (VECM) approach to identify short- and long-run causal relationships between CO₂ emissions and mode-specific transportation development, including railway, road, airline, and inland waterway. We find that China's domestic expansions of road, airline, and waterway infrastructure lead to long-run increases in CO₂ emissions. Among them, waterway has the strongest positive impact on CO₂ emissions, followed by road. Despite a short-run, positive impact on CO₂ emissions, railway expansion leads to long-run decreases in CO₂ emissions. The results are especially encouraging for the central government of China given its long-standing and on-going efforts to expand railway infrastructure at the national level. Looking forward, it is recommended that China continues its national investments in railway infrastructure to achieve both environment and economy goals.