The average environmental efficiency technique and its application to Chinese provincial panel data.

Jing Tang,Fangqing Wei,Feng Yang

doi:10.1007/s11356-022-18751-9

Abstract

In this study, we propose average environmental efficiency, a more comprehensive, fair, comparable, and robust environmental efficiency measurement considering all projection directions to the efficient frontier, and then it is used to evaluate the environmental efficiency of Chinese provinces from 2006 to 2017. Furthermore, we investigate the most influential factors of regional environmental efficiency via a feasible generalized least squares regression approach. The empirical results show that only nine Chinese provinces have average environmental efficiency greater than the national average, implying that two-thirds of the provinces still have much room for improvement. Additionally, environmental efficiency disparities exist between provinces and between four larger geographical areas. The east area achieved the best environmental efficiency over the studied period, better than the whole country, followed in order by the west area, central area, and northeast area. Moreover, we find that the energy consumption structure, government intervention, and economic openness significantly and negatively influence regional environmental efficiency. Finally, we provide policy implications in terms of energy consumption structure optimization, government supervision, and foreign investment introduction while considering the local conditions in different provinces.

Highlights

China has achieved considerable economic growth in the more than four decades since its “Reform and Opening-up” policy started in 1978
We find that the energy consumption structure, government intervention, and economic openness negatively influence the regional environmental efficiency, while higher education positively influences this efficiency at the 1% significance level
One critical issue in previous studies has not been well addressed: the environmental efficiency of a decision making units (DMUs) is commonly measured along a direction determined by either an exogenous or endogenous mechanism

Summary

Introduction

China has achieved considerable economic growth in the more than four decades since its “Reform and Opening-up” policy started in 1978. China’s gross domestic product (GDP) increased from 365 billion (CNY) in 1978 to 90,030.9 billion (CNY) in 2018. The price of such rapid economic growth has been a huge consumption of energy resources as well as serious environmental pollution problems (Li et al, 2020b). The economic development, energy consumption, and environmental pollution present huge differences between provincial-level regions (Li et al, 2020b). Environmental efficiency measures the coordinated development of economy and environment; improving environmental efficiency is one key way to create economic growth while achieving energy conservation and emission reduction (Meng et al, 2016; Wang et al, 2018; Stergiou and Kounetas, 2021).

Methods

Findings

Discussion

Conclusion