Abstract
China’s environmental regulation regime remains mainly government-oriented, consisting of the government environmental investment policy and the command–control policy. This paper first improves the traditional environment Copeland-Taylor model by including the above two types of government-oriented environment instruments. Then, based on a comprehensive firm-level dataset, we examine the effects of government-oriented environmental instruments on firms’ water pollutant emission abatement in the Yangtze River Economic zone. We find robust evidence of a significant decrease of 2.99% in chemical Oxygen Demand(COD) discharge and of 3.55% in ammonia nitrogen(NH3) discharge of firms in response to the government environmental investment policy, whereas the command–control instrument shows little effect on firms’ water pollutant emission reduction. Our results are robust when using alternative measurements for two types of environmental instruments. Additionally, we also find there exist heterogeneous effects across sub-samples: (1)comparing with large and medium firms, small and micro firms are more liable to be influenced by the two types of government-oriented environmental instruments; (2) the effect of two types of government-oriented environmental instruments is obviously significant in the intensive-water-pollution industry, whereas it is not obvious in clean industry; (3) the effect of government environmental investment is obvious on state-owned enterprises and domestic joint ventures, whereas the command–control policy has effectively reduced the water pollutant discharge for domestic joint ventures and private firms. Finally, this study also presents some future policy implications.
Highlights
Water environment management remains an important global public policy issue
Monitoring Sources of Pollution Firms (KNMSPF)and the Annual Survey of Industrial Firms (ASIF), we can evaluate the effect of environmental regulations on manufacturing activity; (2) constructing a theoretical model by including two types of environmental instruments into the traditional Copeland–Taylor environment model to analyze the effect of different environmental instruments on firms’ water pollution abatement; (3) Considering China’s current one fold, mainly governmental-oriented environmental regulation setting, and the unavailability of the market-oriented environmental regulation data, we mainly evaluate the effect of two types of governmental-oriented environmental regulations, i.e., government environmental investment policy and the command–control policy on firms’ water pollutant discharge
We first focus on our baseline outcomes of the effect of two types of environmental policies on firms’ water pollutant discharge
Summary
Water environment management remains an important global public policy issue. With the acceleration of industrialization, China’s water quality has been deteriorated to one of the world’s worst.In recent years, the Chinese government has taken more stringent water environmental regulations to change this situation. Water environment management remains an important global public policy issue. With the acceleration of industrialization, China’s water quality has been deteriorated to one of the world’s worst. The Chinese government has taken more stringent water environmental regulations to change this situation. This paper aims to explore the effect of China’s water management practice and offer some possible experience to other countries using the Yangtze River Economic Zone as a study area. Sustainability 2020, 12, 7841; doi:10.3390/su12197841 www.mdpi.com/journal/sustainability Sustainability FOR PEER REVIEW. Sustainability 2020, 12, x7841 22 of of 19. As the largest industrial base in China, the Yangtze River Economic Zone accounts for 43% of.
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