Environmental decoupling, eco-efficiency improvement, and industrial network optimization: Insights from 44 sectors in China

Improving eco-efficiency is an important way to promote environmental decoupling. Based on the input-output model and data envelopment analysis (DEA), this paper evaluates the eco-efficiency of 44 sectors in China with a new DEA model considering inter-sectoral linkages, then explores how the industrial network would be opti-mized as inefficient sectors become efficient under constant resources supply and constant final demand. The empirical results indicate that 22 sectors are inefficient and deserve further improvement. Inefficient sectors becoming efficient will drive the industrial network to evolve in a more intensive direction, and allow the economy to achieve greater economic benefits with less energy consumption and pollution. Accounting under constant resources supply suggests that increasing external demand should be a key to promoting environmental decoupling in the economy. Accounting under constant final demand indicates more stringent environmental regulations should be used to drive technology upgrades.