Abstract
China has introduced an innovative water management institution—the River Chief Policy (RCP)—to manage water quality. Using the difference-in-difference (DID) method and panel data from 40 cities in the Yangtze River Economic Belt during the period from 2004 to 2015, we explore the effect of the RCP on surface water pollution. Our results first revealed that the RCP could substantially improve water quality. However, the effect of the RCP leveled off following its implementation. Second, the possible reasons why the RCP works well are industrial structure upgrades and the stringent policy measures to control industrial waste discharge. Third, we found that the effect of the RCP had heterogeneous impacts from city to city. More specifically, the RCP could reduce water pollutants more efficiently in cities with higher GDP levels and in cities with more rigorous environmental regulations. Finally, some policy implications for future versions of the RCP are presented.
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