Abstract
“Fast fashion” represents a short product life cycle, and international SPA enterprises are therefore criticised as representatives of high energy consumption, pollution, and emissions, which is contrary to China’s goal of achieving carbon neutrality. In the context of China’s shift to a low-carbon economic development model, how should SPA enterprises breakthrough in the face of China’s large-scale market advantage and domestic demand potential? Based on the statistics of 277 prefecture-level cities from 2010 to 2018, this article selects 5 leading international SPA enterprises and uses the difference-in-differences (DID) method to explore the impact of low-carbon initiative on the location expansion of international SPA enterprises. The results suggest that the quantity of location expansions of SPA enterprises in the pilot cities is significantly lower by approximately 0.418 units compared with the nonpilot cities, implying that the low-carbon initiative has a significant inhibitory effect on the location expansion of SPA enterprises. After a series of robustness tests, the conclusion is valid. The results of the heterogeneity test suggest that the suppression effect is mainly found in the subsample of central cities and cities with medium and low levels of economic development. This article proposes that SPA enterprises should reduce their carbon emissions and gradually explore a green and sustainable development path.
Highlights
In recent years, with rapid economic development, industrialisation, and urbanisation, the problem that China needs to solve urgently is the huge amount of carbon dioxide emissions with a large amount of energy consumption [1, 2]
Difference in Difference Model. is article uses a DID approach to identify the impact of low-carbon city initiative on the locational expansion activities of SPA enterprises in China. e DID method is a measure that analyses the causal relationship between variables and is effective in assessing the effects of policies [14, 15]. e double difference stems from the city level as well as the year level and compares the difference in location expansion of SPA enterprises in pilot and nonpilot cities before and after the pilot
In model (1), i and t denote city and year, respectively; NEWit denotes the number of new stores opened by international SPA enterprises; TTit denotes the state in which the low-carbon city pilot is located; Xit denotes the control variable; ui and λt denote the city fixed effect and year fixed utility, respectively; εit denotes the random error term. β is the DID statistic, which is the core coefficient of most interest in this article, reflecting that the low-carbon city initiative affects the net effect of SPA enterprises’ locational expansion activities
Summary
With rapid economic development, industrialisation, and urbanisation, the problem that China needs to solve urgently is the huge amount of carbon dioxide emissions with a large amount of energy consumption (see Figure 1) [1, 2]. By 2030, China will have widely formed a green production and green living lifestyle, with carbon emissions reaching a peak and steadily decreasing, basically achieving its predetermined goal of building a beautiful China. Against this background, a question that needs to be answered urgently is what impact will government environmental regulation have on the development path of traditional high pollution and high energy consumption enterprises?
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