Has Central Environmental Protection Inspection Promoted High-Quality Economic Development?—A Case Study from China

Abstract

Environmental regulatory policies are crucial to the high-quality development of China’s economy. Can central environmental protection inspection, another major innovation in China’s environmental regulation policy, significantly contribute to high-quality economic development? To address this question, this paper is the first time to intensely discuss the relationship between central environmental protection supervision and the high-quality development of China’s urban economy. The research level is expanded from the previous micro-enterprise level to the macro level. Starting from the city, the main body of green innovation, and using the propensity score matching and difference-in-differences methods, we test the impact of central environmental protection inspection on high-quality economic development. A preassessment at the regional level reveals that the green total factor productivity of the inspected cities is significantly higher than that of the non-inspected cities, and parallel-trend tests and placebo tests also support the result. Subsequently, the persistence of the policy impact is further analyzed, and the results show a significant impact only in the year of policy implementation. Finally, the heterogeneity analysis shows that central environmental protection inspection can significantly promote high-quality economic development in cities in the eastern region, but has a significant inhibitory effect on the western region.