Overall employment is just under 0.2% lower relative to the baseline. As expected carbon pricing has a stronger negative impact in energy-intensive sectors, with coal mining and power generation declining by around 1.1% and 0.7% respectively (Figure 2.14, Panel B). Assessing the impact of carbon pricing in China (cont.) The overall impact is more muted than under the first scenario, with GDP declining only marginally, while the decline in carbon emissions is only slightly smaller. One of the main reasons for the different overall impact under this alternative scenario is that consumption rises in response to the tax cut, thereby improving the domestic balance of the economy and boosting production in some sectors.