Does place-based green policy improve air pollution? Evidence from China's National Eco-Industrial Demonstration Park Policy.

Abstract

Air pollution is one of the serious environmental problems facing the world. This paper systematically investigates the impact and transmission mechanism of the construction of national eco-industrial parks (NEDPs) on urban air pollution based on Chinese city-level panel data from 2003 to 2021 using a staggered difference-in-differences (staggered DID) model. It is found that the construction of NEDP significantly reduces urban air pollution, a conclusion supported by the negative weight diagnostic test and two types of robust DID estimators. Mechanism analyses indicate that NEDP construction reduces urban air pollution mainly by improving regional environmental regulation, promoting green technology innovation and improving energy structure. In addition, the mitigation effect of NEDP construction on urban air pollution is heterogeneous by policy intensity, city resource endowment, city size and administrative status. Further tests show that the institutional environment enhances the air pollution mitigation effect of NEDP construction and that the better the degree of marketization, property rights system, legal system and market development in the place where the policy is implemented, the more conducive it is to amplify the air pollution suppression effect brought about by NEDP construction. Developing economies should take complete account of the characteristics of different regions when implementing place-based green policies to achieve synergistic development of the environment and the economy.