Regional environmental efficiency in China: An empirical analysis based on entropy weight method and non-parametric models

Abstract

While vigorously developing its economy, China is attaching more and more importance to environmental protection and pollution control. In different regions of China, however, there are great differences in economic development and the degree of environmental pollution. In this study, we use the entropy weight method to calculate the pollution indexes of different regions from 2015 to 2017. Then we evaluate the Chinese regional environmental efficiency based on a new non-parametric frontier model. Moreover, a new set of ranking interval models that treat the undesirable outputs as inputs is proposed to further describe the regional disparities of the environmental efficiency between different regions with robustness. Finally, we conduct an empirical analysis by combining the stepwise regression and principal component analysis to identify the most influential variables that may affect regional environmental efficiency. According to the results, the southeast region of China performs best in environmental efficiency, followed by the northeast region, then the southwest region, and the worst is the northwest region. For managerial implications, we find that the investment of high education and the development of the IT industry can significantly increase regional environmental efficiency. More importantly, the results of the principal component analysis provide the government with a set of variables to strategically select the most appropriate strategy.