The Effect of Environmental Regulation on Marine Economic Transformation under the Decentralized System: Evidence from Coastal Provinces in China

Abstract

The transformation of the marine economy is a central issue in China’s economic sustainability. On the conflicting goals between sustaining a strong marine economy and protecting the environment, this study explored the direct and spillover effects of two types of regional environmental regulation on the marine economic transformation of China’s coastal provinces (excluding Hong Kong, Macao and Taiwan) under a decentralized system. By establishing a theoretical framework, using panel data of coastal provinces (cities) in China from 2010 to 2019, and using methods of spatial correlation test and spatial measurement model involved moderator, the results show: (1) The gaps in marine economic transformation were gradually narrowed among these regions, but a significantly negative spatial autocorrelation remained. (2) Incentive-type environmental regulation had a direct effect on marine economic transformation but had a negative effect on the adjacent areas, and the decentralization system could play a positive moderator effect. (3) The investment-type environmental regulation and local marine economic transformation showed a significant “U-shape” relationship, and such regulation had a positive effect on adjacent areas. Decentralization could aggravate the negative effect on the local level but had not yet significantly changed the spillover effect. (4) Presented suggestions for formulating policy, industrial transfer compensation, and regulation decentralization. Hopefully, the findings of this study can shed light on how to improve the efficiency of environmental regulation and realize the sustainable goals of the marine economy.