Does the EU emissions trading system help reduce PM damage? A research based on PSM-DID method.

Air quality issues, especially haze pollution, have become an important aspect that threatens the sustainable development and health of human beings. Previous studies on the environmental effects of emissions trading system (ETS) mainly focused on carbon emission reduction, instead of focusing on the synergistic governance effect between carbon emission and PM reduction. Based on the PSM-DID method and the World Development Index (WDI) database, this paper examines whether the EU ETS has a spillover effect on PM damage reduction, and discusses the related impact mechanisms. The research results show that the EU ETS promotes the reduction of PM damage, and in different phases of implementation, the impact of the EU ETS on the reduction of PM damage has a dynamic effect. The robustness test results also show that the research conclusions of this paper are highly reliable. Finally, this paper gives relevant policy suggestions, which can encourage countries to achieve carbon emission reduction targets while helping to reduce PM damage, and eventually achieve a win-win situation between economic growth and environmental improvement.