Abstract
Abstract As the problem of carbon emissions is becoming increasingly more serious around the world, how to balance carbon emissions reduction and economic growth has become an important issue in the field of environmental economics. China is the world's largest carbon dioxide emitter, and China's Low-Carbon Pilot (CLCP) policy has significantly reduced carbon dioxide emissions and achieved expected benefits. However, is environmental quality improving at the expense of economic growth? This article selects macro panel data of 286 Chinese prefecturelevel cities and micro data of Chinese industrial enterprises from 2001 to 2013, takes the CLCP policy implementation by five provinces and eight cities as a quasi-natural experiment, uses difference-in-differences (DID) method to investigate the causal effect of CLCP policy on regional economic growth and enterprise behavior. The results are as follows. First, the CLCP policy significantly promotes regional economic growth. Moreover, as the implementation time of the policy continues, environmental regulation has a greater effect of promoting economic growth. Second, although the CLCP policy significantly increases various production costs, it also promotes the growth of enterprises' output and benefits. Third, under the pressure of enterprise cost increase caused by environmental regulation, enterprises choose the positive way of strengthening internal management, improving efficiency and increasing innovation instead of choosing the negative way of trans-regional transfer, and finally achieve an improvement in output and benefits.
Highlights
With the continuous expansion of human activities, climate change and environmental conditions are greatly affected, which has become an important issue that restricts human survival and further development
The results show that environmental regulation is negative for the rate of regional economic growth, and the effect of regulation competition on economic growth is heterogeneous in different regions; it is positive in the eastern region, negative in the central region, and there is no significant impact in the western region
It can be seen from the table that regardless of whether regional economic growth is measured by regional GDP or per capita GDP, the implementation of the China's Low-Carbon Pilot (CLCP) policy has a promoting effect on the economic growth of pilot cities, and the effect is significant at the 1% confidence level
Summary
With the continuous expansion of human activities, climate change and environmental conditions are greatly affected, which has become an important issue that restricts human survival and further development. The Chinese government attempts to explore a beneficial governance path to further reduce carbon emissions, improve environmental quality and transform the extensive development mode of China's economy that features high energy consumption, pollution and emissions to thoroughly realize a green and clean development mode. This policy is an important tool of environmental regulation for China.
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