Synergistic effects of pollutant control: Evidence from China's sulfur dioxide emission control policy

Abstract

This study investigates the impact of China's national sulfur dioxide emission control policies on carbon dioxide emissions. Using the difference-in-difference-in-differences (DDD) estimation method, we analyze the synergistic effects of environmental regulations on pollution control and carbon emission reduction. Empirical findings demonstrate that sulfur dioxide emission regulations have a significant effect on reducing firms' carbon dioxide emissions, primarily through energy conservation measures. Furthermore, results reveal variations in the effectiveness of these regulations across different types of firms and regions. Specifically, state-owned and large-scale firms, along with those situated in the eastern and central regions of China, exhibit greater energy-saving and emission-reducing effects in response to the regulations. Notably, these regulations lead to unexpected energy savings and emission reductions without compromising output, highlighting improvements in energy efficiency as a key driver. These findings underscore the importance of recognizing the potential synergies between pollutant control policies and carbon emission reduction goals. To maximize these positive effects, policymakers should prioritize strategies to enhance energy efficiency and tailor environmental regulations to suit the unique characteristics of firms and regions. Overall, this study contributes valuable insights to the development of effective environmental policies in the context of carbon peaking and neutrality objectives of China.