Abstract
This study was based on research on the impact of environmental regulation on industrial efficiency in 30 provinces from 2005 to 2017 in China. For the explained variables, the industrial efficiency of the DEA-Malmquist method was utilized for the decomposition and measurement of overall factor productivity, and government environmental governance variables were added as instrumental variables for two-stage least-squares regression. In addition, environmental regulatory intensity and year were utilized as threshold variables for the threshold test. In the benchmark regression, environmental regulation harms regional industrial efficiency. However, according to the IV estimation of government environmental governance variables, environmental regulation has a positive effect on the transformation of regional industrial efficiency. The influence of environmental regulation on industrial efficiency will be first suppressed and then promoted with the gradual increase of regulatory intensity. Furthermore, there is significant spatial heterogeneity in the impact of environmental regulations.
Highlights
Whether environmental regulation impedes industrial efficiency is somewhat controversial in academic circles
There is the “double dividend” theory, in which environmental taxation will cause a “green dividend” of curbing pollution, improving the environment a “blue dividend” of increasing social employment, and promoting economic growth. ird, there is the “pollution sanctuary” effect, in which economic activities are relocated to areas with lax environmental regulations, resulting in the increased environmental pollution in the area in exchange for economic growth. e first two theories illustrate the positive effect of environmental regulation on industrial efficiency, while the last theory illustrates the inhibiting effect of environmental regulation on local green welfare
China’s economic development has shifted toward a “new normal,” the goal of which is to establish sustainable economic growth through establishing a symmetrical economic structure emphasizing the structure of economic growth rather than the overall economy, such as greening industrial efficiency adjustment
Summary
Whether environmental regulation impedes industrial efficiency is somewhat controversial in academic circles. Zhang et al made useful explorations from sustainable development, reusing industrial byproducts, and green construction in civil engineering [12,13,14,15,16], and further expanded the research scope of environmental regulation and industrial development. These authors employed scientific research methods and instruments to scientifically determine the direction and extent of the effect of environmental regulation on industrial efficiency. Based on the spatial heterogeneity and related literature studies, foreign direct investment, regional economic development level, and provincial intervention policies are used as control variables to eliminate influencing factors besides the core explanatory variable of environmental regulation
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