How Does Income Inequality Influence Environmental Regulation in the Context of Corruption? A Panel Threshold Analysis Based on Chinese Provincial Data.

Shi Wang,Wen Zhang,Mu-Jun Jiang,Hua Wang,Jue Wang

doi:10.3390/ijerph18158050

Abstract

The question of how the income inequality of residents affects the level of environmental regulation in the context of official corruption was the core research issue of this study. We analyzed this problem using the panel threshold regression model from 26 provinces in China from 1995 to 2017. We found that when there is no official corruption, the widening of the residents’ income inequality promotes stricter environmental regulations; when the corruption problem is serious, the expansion of the residents’ income inequality leads to the decline in environmental standards; that is, the impact of residents’ income inequality on environmental regulation has a threshold effect due to corruption. In addition, the threshold effect due to corruption of all residents’ income inequality on environmental regulation is mainly generated by the urban residents’ income inequality and the urban–rural income inequality. This paper contributes to the literature that concentrates on the relationship between income inequality and environmental regulation, and shows that corruption is a key factor that can deeply influence that relationship. The research conclusion shows that increasing anti-corruption efforts can not only maintain national political stability, social fairness, and justice, but also be a powerful measure for environmental pollution governance.

Highlights

The achievements associated with China’s economic development since its reform and opening up are world-renowned, and the material living standards for the majority of the population have been greatly improved
This study considered how corruption affects the impact of income inequality on environmental regulation
When the level of official corruption is low, the expansion of residents’ income inequality promotes stricter environmental regulations, and when the level of official corruption is higher, the expansion of residents’ income inequality causes the decrease in environmental standards. This validates the hypothesis of the theoretical analysis and is consistent with the research by He et al [27]

Summary

Introduction

The achievements associated with China’s economic development since its reform and opening up are world-renowned, and the material living standards for the majority of the population have been greatly improved. At the same time, environmental pollution caused by economic development has become more serious. The past five editions of the Environmental Performance Index (EPI), published by Yale University every two years, showed that China’s environmental quality ranked 105th in all counted countries in. It can be observed that China’s relative ranking has increased since 2014, it is still in a backward position among all countries. In the 2018 report, China’s air quality was ranked fourth from the bottom of all of the counted countries. Long-term exposure to polluted air has made residents north of the

Objectives

Results

Conclusion