Trade-related carbon emissions have emerged as a significant environmental challenge, yet strategies to mitigate their impact remain underexplored. This paper examines the role of digital empowerment in reducing the trade-embodied carbon intensity of services, with a focus on a value-added trade approach. Using panel data from 67 economies spanning from 1995 to 2018, this paper empirically demonstrates that digital empowerment significantly lowers trade-embodied carbon intensity in services. Key mechanisms driving this reduction include scale effects, intra-industry enhancements, and trade structure optimizations. Our findings reveal that both domestic and foreign digital empowerment sources positively impact trade-embodied carbon intensity reduction, with a more pronounced effect in developing economies compared to developed ones. This study advances the understanding of how the digital economy influences the carbon competitiveness of services and provides critical insights for policymakers in crafting service trade and green development strategies.

Digital technologies are increasingly vital catalysts for industrial green transitions, yet their heterogeneous decarbonization impacts across development countries tiers remain underexplored. We pioneer a novel Hypothetical Extraction Method (HEM) to quantify digital empowerment, revealing asymmetric pathways using sectoral data from 43 economies: Advanced economies exhibit a U-shaped trajectory where digitalization initially reduces emissions/intensity but induces rebound effects beyond optimal thresholds, while emerging economies show an inverted U-curve for domestic digital inputs. Mechanistic analyses confirm technology and scale effects universally exist, but structural effects diverge—digitalization raises capital returns in advanced economies yet reinforces coal dependence in developing contexts. Foreign digital sources demonstrate positive environmental returns in emerging economies. Sectorally, digital technologies function as carbon catalysts in manufacturing through automation efficiencies but act as transitional carbon amplifiers in services due to platform-induced energy rebounds. These findings challenge linear decarbonization assumptions and provide empirical foundations for bifurcated digital-climate policies tailored to national development stages.

Given the magnitude impact of global value chains (GVCs) in reconstructing the pattern of world trade, its employment implications deserve thorough study. In this paper we explore the impact of GVCs position on employment across countries and its heterogeneous mechanisms. We perform an in-depth theoretical analysis followed by an empirical test using panel data for 56 industries in 42 countries from 2000 to 2014. The results show that enhancing the GVCs position will significantly increase employment, with a more pronounced effect in developing countries. Mechanical tests demonstrate a positive wage effect for developed countries. For developing countries, there is a positive demand effect and a negative factor substitution effect. Heterogeneity tests show that developed countries promote employment primarily by improving the forward GVCs position. Developing countries boost employment mainly by reducing the backward GVCs position. Further research has revealed that employment in developed countries has a clear preference for industries with higher GVCs, crowding out employment in other industries. This paper has enriched research on the employment implications of GVCs position and exploring the possible crowding effect during the evolution of the position of GVCs, which has been informative and insightful for countries in formulating GVCs participation and employment policies.