Abstract
China’s economic development has resulted in significant resource consumption and environmental damage. However, technological progress is important for achieving coordinated economic development and environmental protection. Appropriate environmental regulation policies are also important. Although green total factor productivity, environmental regulations, and technological progress vary by location, few studies have been conducted from a spatial perspective. However, spatial spillover effects should be taken into consideration. This study used energy consumption, the sum of physical capital stock and ecological service value as total capital stock, the number of employed people as inputs, sulfur dioxide emissions as undesired outputs, and green GDP as total output to obtain green TFP through a slacks-based measure (SBM) global Malmquist-Luenberger Index. This study also estimated China’s biased technological progress under environmental constraints from 2004 to 2015 based on relevant data (e.g., green GDP, total capital stock, and employment figures). The relationship between green total factor productivity (GTFP), technological progress, and environmental regulation was then examined using a spatial Durbin model. Results were as follows: (1) Based on the complementary elements, although the labor costs gradually increase, the rapid accumulation of capital leads to technological progress that is biased toward capital. However, technological progress in the labor bias can significantly increase GTFP. (2) There is a u-shaped relationship between existing environmental regulations and GTFP. Technological progress can significantly promote GTFP in the surrounding areas through existing environmental regulations. (3) Under spatial weight, the secondary industry coefficient was negative while human capital stock and FDID had positive effects on GTFP. Technological progress is the source of economic growth. It is therefore necessary to promote biased technological development and improve labor-force skills while implementing effective environmental regulation policies.
Highlights
China has experienced rapid economic growth over the past 40 years as a result of economic reforms
This study adds the product of technological progress and environmental regulation to the model to explore the effect of environmental regulation on green total factor productivity under the influence of technological advancement
The results show that labor-force transfers in developed and peripherally undeveloped areas are accompanied by technological spillover, and that green total factor productivity (GTFP) has an exemplary effect in developed areas
Summary
China has experienced rapid economic growth over the past 40 years as a result of economic reforms. This trend has spread to the central and western regions If such development cannot be altered and improved, Chinese companies will lack sustainable profitability, becoming dependent on limited resource and environmental destruction in exchange for economic growth [2]. They have proposed to measure the economic performance of a region with total factor productivity This will reveal the overall quality of China’s economic growth, and reflect the environmental factors indicating whether economic growth is sustainable. At the same time, using technological progress to measure innovation will help promote both environmental protection and economic growth [4] This may solve China’s complex problems, in which “innovation capacity is not strong enough”, “the level of the real economy needs to be improved”, and “eco-environment protection is a long and arduous task” [5]
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