Changes In Environmental Regulations Research Articles

Factor analysis of environmental effects in circular closed‐loop supply chain network design and modelling under uncertainty in the manufacturing industry

AbstractSustainable development and competitive advantage are impacted by strategic choices that maximize resource value and reduce waste. Numerous instances of thriving OEM remanufacturing can be observed, predominantly in the business‐to‐business domain. The significance of Closed‐Loop Supply Chain (CLSC) in generating value and managing the recovery process is widely acknowledged within the supply chain industry. Manufacturing companies now have to come up with green supply chain and process design strategies in response to recent changes in environmental regulations. This study designates the specific features of circular closed‐loop supply‐chain design considering end‐of‐life products. Uncertainty in various aspects, such as acquisition, processing, and market stages, is impeding the progress of circular economies and also sustainable development in closed‐loop supply chains (CLSCs). This has led to increased complexity in remanufacturing processes and decreased efficiency. To address this issue, the study proposes a comprehensive, integrative approach for establishing a sustainable CLSC network that adapts to fluctuating demand through a questionnaire analysis. Moreover, the study introduces a multi‐objective optimization model for a dual‐channel supply chain network, aiming to enhance the flow. This model considers both economic and environmental objectives to achieve a sustainable and efficient supply chain system. To determine the ideal circular closed‐loop supply chain (CLSC) network design, the research proposes linear programming model with mixed integer, where recovery can take place in one of three ways: through material recovery, component recovery, or product recovery. Numerous findings from a thorough analysis by data backup that inform CLSC managers of ways to improve product returns in terms of quantity and quality. To address the uncertainty problem, the research also developed the fuzzy credibility constraint technique with a Simulated Annealing algorithm. Using cutting‐edge methods, it is explored and compared how sensitivity analysis results, the impact of altering the problem parameters, and the performance of the suggested model respectively.

Economic policy uncertainty and the inhibitory effect of firms' green technology innovation

Given the potential unforeseen impacts of environmental regulation changes on the innovative activities of micro agents, it is crucial to examine the effects of economic policy uncertainty (EPU) on business development. Several studies have shown that uncertainty acts as a hindrance and can hinder business innovation. This study utilizes data from 807 listed companies spanning from 2007 to 2019 and employs a double fixed-effects model to investigate the influence of EPU on enterprises' green technology innovation activities. The results reveal that EPU decreased firms' green technology innovation. Moreover, EPU inhibits corporate green technology innovation by increasing corporate financing constraints. Thus, financing constraints mediate between EPU and enterprises' level of green technology innovation, with increased market competition reducing the inhibiting effect of EPU on innovation. Furthermore, EPU decreases green technology innovation more among nonstate-owned and low-tech businesses than state-owned and high-tech businesses. This paper reveals the intrinsic mechanism of EPU on firms' innovation, clarifies the technological innovation process, and provides insights into governmental environmental governance from the perspective of EPU.

CEO Compensation and Adverse Shocks: Evidence from Changes in Environmental Regulations

CEO Compensation and Adverse Shocks: Evidence from Changes in Environmental Regulations

CEO Compensation and Cash-Flow Shocks: Evidence from Changes in Environmental Regulations

CEO Compensation and Cash-Flow Shocks: Evidence from Changes in Environmental Regulations

Supply and demand conflicts of critical heavy rare earth element: Lessons from gadolinium

Our understanding of supply and demand conflicts of critical minerals is quite limited, which may inhibit strategies in their criticality mitigation. This is particularly severe for gadolinium (Gd), as a heavy rare earth element, given its small amounts in supply and wide applications ranging from glass to NdFeB magnets. This study (1) developed a sophisticated accounting framework to measure the supply and demand trends of Gd within China from 1990 to 2018 and (2) provided a qualitative review and discussions on Gd supply-demand balance in a holistic perspective. Our findings suggest that the balance of Gd supply and demand shows a cyclical trend, termed as periodic "scarcity-abundance" pattern, influenced by changes in environmental regulations, trade structures, and technological applications. This highlights the importance of the joint measurement of both supply and demand of critical minerals for their criticality mitigation.

Environmental regulation promotes green development in China: from the perspective of technological innovation

Based on panel data of 286 prefecture-level cities in China, this study analyzes the direct impact of environmental regulation and its classified policies on green development, while exploring the indirect effects and threshold effects of technological innovation in the green development effect of environmental regulation. There are four main findings in this study. 1) The impact of environmental regulation on green development follows a U shaped pattern and its mode varies with the type of environmental regulation and the type of cities. 2) Environmental regulation can promote green development through technological innovation, and the industrial structure has a positive moderating effect. 3) Technological innovation is a threshold variable in the impact of environmental regulation on green development: when technological innovation surpasses the threshold value, the green development effect of environmental regulation changes from negative to positive. Therefore, governments should strengthen environmental regulation, effectively play the driving role of different environmental regulation policies, and transform the development driving force through strengthened technological innovation to achieve regional green development.

Moving up the global value chain: Effects of water pollution control regulations in China

AbstractThis paper investigates the impacts of stringent environmental regulation of firm‐level upstreamness in the global value chains (GVCs). Specifically, we use the non‐uniform promulgation of local water pollution control regulations across cities and over time after the 11th Five‐Year Plan as a quasi‐natural experiment in China, in which firms are forced to adopt cleaner technologies or equipment to reduce pollution after enforcing tighter environmental standards. Using highly disaggregated firm‐level data between 2008 and 2014, we find that firms in cities with stricter water pollution regulations tend to move to more upstream sectors in the GVCs. We find that this effect is more prominent for low‐productivity firms, high‐polluting firms, and firms with a high dependence on water in production. This paper sheds new light on the GVC upgrading of firms in response to environmental regulation changes.

How does mandatory environmental regulation affect corporate environmental information disclosure quality

We utilize the environment fee to tax reform implemented in 2018 as a quasi-experiment, to investigate the impact of mandatory environmental regulation change on firm environmental information disclosure quality. Using data from listed companies in China between 2015 and 2020, we found that the mandatary environment regulation positively affects the monetary and non-monetary environmental information disclosure in heavy polluting industries. The mechanism analysis shows that external governance and internal control mediate the effect of mandatory environmental regulation on environmental information disclosure quality. We also found that, firms with low market values and no environmental subsidies disclosed more information due to environmental taxes.

COVID-19 and the Environmental Regulatory Response: Compendium of Regulatory, Ad Hoc Changes and Implications

Using open source and official documents, we documented and analyzed changes in environmental regulations in response to the COVID-19 pandemic. We accumulated 71 such regulatory changes across 29 countries, spanning several environmental sectors, between March and July 2020. The objective of our analysis is to characterize trends, impacts and implications of regulatory changes adopted in response to COVID-19. Our analysis contributes to understanding the types and nature of changes that the pandemic may induce in environmental policy through behavioral changes and resource use. Examination of the data shows that countries around the globe largely pursued rollbacks and enforcement relief in response to COVID-19. However, developing countries in our data were more likely to tighten environmental regulations compared to developed economies, where steps towards deregulation dominated regulatory changes. The data also shows that actions in the energy sector were geared toward deregulation. Air quality and biodiversity regulations were rolled back in response to the COVID-19 pandemic, despite rising concerns about the links between the coronavirus and pollution, wildlife, and habitat destruction. It can be concluded that the nature and type of changes in environmental regulations across countries in response to COVID-19 depended on a country’s economic development status and that the degree of regulatory changes across different sectors was driven by the differences in the social and economic impacts of the pandemic.

The Environmental Consequences of Place‐Based Policies in China: An Empirical Study Based on SO2 Emission Data

AbstractPrevious studies of place‐based policies in China have ignored their effect on pollution. Using event study and difference‐in‐differences methodologies, we investigated the consequences of place‐based policies on sulfur dioxide (SO2) emissions. We first documented the increase in SO2 emissions and SO2 emission intensity in the inland region after 2003 at the provincial level. The firm‐level data for the period between 1998 and 2010 also showed that the performance of enterprises in noneastern regions in reducing SO2 emissions had worsened relatively since 2003, and this effect was particularly strong in enterprises located in central and northeast China, where urban land supply experienced significant growth after 2003. We found that, compared with environmental regulation changes, inland region‐biased economic policies after 2003 were more important in explaining the relative changes in SO2 emissions between coastal and inland regions. The policy implication is that the central government should address environmental consequences when designing place‐based economic policies.

The Impact of Environmental Regulation and Carbon Emissions on Green Technology Innovation from the Perspective of Spatial Interaction: Empirical Evidence from Urban Agglomeration in China

As an important means of reducing carbon emissions, environmental regulation and green technology innovation have become a top research topic in academia in recent years. Existing studies have investigated the phenomenon of green technology innovation responses to carbon emissions, but there is less existing literature explaining this phenomenon from a spatial perspective and exploring the effect of the joint mechanism of carbon emissions and environmental regulation on green technology innovation. Based on the spatial econometric model, this study used the panel data of 41 cities in the Yangtze River Delta urban agglomeration from 2010 to 2019, to measure the impact of environmental regulation and carbon emissions on green technology innovation from the perspective of spatial interaction. The findings are as follows: green technology innovation in the Yangtze River Delta urban agglomeration shows a trend of “high in the east and low in the west” and has spatial autocorrelation; green technology innovation responds positively to changes in environmental regulations and carbon emissions and, by decomposing the spatial effects, it can be observed that there is a spatial spillover effect of environmental regulations and carbon emissions on green technology innovation in the surrounding areas; there is a substitution effect between environmental regulations and carbon emissions. This paper combines the above results and proposes the corresponding policy recommendations.

Interdecadal variation in sediment yield from a forested mountain basin: The role of hydroclimatic variability, anthropogenic disturbances, and geomorphic connectivity

Variation in sediment yield may reflect a signal of disturbances in the upstream landscape, modified by sediment routing. This study, conducted in a forested drainage basin in the inland Pacific Northwest, USA, sought to generate a better insight into the interdecadal variability of sediment yield in mountain landscapes in response to environmental change during the last century. To this end, we examined: (1) sediment yield fluctuations; and (2) their association with streamflow and land use changes; as well as (3) streamflow links to climate variability modes; and (4) the influence of sediment delivery from hillslope sources to streams (lateral connectivity) and its downstream routing through the stream network (longitudinal connectivity) on land use signal at the basin's outlet. Sediment yield between 1910 and 2017, estimated based on reconstructed fluvial delta growth, displayed an order of magnitude variability, which indicates a substantial geomorphic sensitivity. The interpretation of temporal patterns and an exploratory statistical analysis pointed to land use-related sediment supply changes as the primary driver of these fluctuations, dominating system behavior before changes in environmental regulations and practices in the mid-1970s. Hydroclimatically controlled streamflow variability appeared to be more prominent in the subsequent period. Our connectivity analysis suggested that a considerable portion of coarse sediment mobilized by harvest and road construction may still reside within the channel network. In light of previous research in this landscape system, we speculate that, despite limited anthropogenic pressures in the recent decades, its characteristics and behavior continue to be conditioned by land use legacies. Overall, this study contributes to the growing understanding of profound anthropogenic transformation of the earth surface. Specifically, it demonstrates that historical resource extraction may have left a lasting imprint even in relatively remote mountain landscapes. Given the ongoing rapid environmental change, such understanding is crucial for watershed management, conservation, and restoration.

Economic Policy Uncertainty, Environmental Regulation, and Green Innovation-An Empirical Study Based on Chinese High-Tech Enterprises.

As the continuous changes in environmental regulations have a non-negligible impact on the innovation activities of micro subjects, and economic policy uncertainty has become one of the important influencing factors to be considered in the development of enterprises. Therefore, based on the panel data of Chinese high-tech enterprises from 2012–2017, this paper explores the impact of heterogeneous environmental regulations on firms’ green innovation from the perspective of economic policy uncertainty as a moderating variable. The empirical results show that, first, market-incentivized environmental regulation instruments have an inverted U-shaped relationship with innovation output, while voluntary environmental regulation produces a significant positive impact. Second, the U-shaped relationship between market-based environmental regulation and innovation output becomes more pronounced when economic policy uncertainty is high. However, it plays a negative moderating role in regulating the relationship between voluntary-based environmental regulation and innovation output. This paper not only illustrates the process of technological innovation by revealing the intrinsic mechanism of environmental regulation on firm innovation, but also provides insights for government in environmental governance from the perspective of economic policy uncertainty as well.

Agglomeration externalities and the non‐linear performance of environmental regulation: Evidence from China

AbstractThe pollution abatement effect of environmental regulation changes periodically in terms of local economic agglomeration levels, because of agglomeration externalities could influence firms' regulatory response by changing the compliance cost. Based on a panel dataset of 30 provinces in China from 1999 to 2017, this paper engages in threshold model and mediation analysis to examine the thresholds of economic agglomeration for environmental regulation to take effect and the influencing paths of environmental regulation at different agglomeration levels. The economic agglomeration degree is measured by the economic density of the built‐up area. The threshold test recognizes two thresholds of economic density, which are 0.3 CNY billion/km2 and 1.7 CNY/km2. Only when economic density exceeds the thresholds, can environmental regulation significantly reduce industrial emission intensity and emission density, respectively. At the first threshold, environmental regulation takes effect mainly through improving local industrial structure; at the second threshold, environmental regulation takes effect mainly through downsizing the scale of polluting industries. The policy enlightenment provided by this article is to formulate differentiated environmental governance strategies according to local conditions and the characteristics of the development stage of each region.

Bead Geometry Prediction Model for 9% Nickel Laser Weldment, Part 1: Global Regression Model vs. Modified Regression Model

Due to its excellent toughness and stiffness in cryogenic conditions, 9% nickel steel is applied to LNG storage facilities, and its usage is increasing as a result of changes in environmental regulations. A study was conducted on the development of a predictive model to optimize the laser welding process of 9% nickel steel, and two prediction models were developed using one hundred data points obtained through experiments. A global regression model used as a general prediction model and a modified regression model using the p-value of the analysis of variance were developed, and their prediction performance was compared. It was found that the modified regression model was superior to the global regression model in terms of predicting the bead shape, including parameters such as penetration depth, bead height, and area ratio.

Do auditors respond to stringent environmental regulation? Evidence from China’s new environmental protection law

Stringent environmental regulation can impact corporations in both positive and negative ways. However, how external auditors respond to the changes in environmental regulation, and alter their assessment of the audit and client environmental risk accordingly, remains underexplored. This study exploits the promulgation of China’s new Environmental Protection Law (EPL) as an exogenous shock, and adopts a difference-in-differences approach to examine the effect of environmental regulation on audit fees. We find that the new EPL increases environmental and audit risk for heavy-polluting firms, to which auditors charge higher audit fees for compensation. The impact of environmental regulation on audit fees is stronger for firms with low-quality environmental disclosure, those in regions with strong regulation and legal enforcement, and those without political connections. Overall, our findings indicate that stringent environmental regulation can generate extra costs and risks for firms and their external auditors.

Environmental regulation benefits for whom? Heterogeneous effects of the intensity of the environmental regulation on employment in China

As environmental pollution in China has deteriorated in the recent years, intensifying environmental regulation has become a necessity for the Chinese government. But the debate persists among the academic circles and the government over whether a double dividend, reducing pollution emission and boosting employment, of environmental regulations exists. This study differentiates, based on Cobb-Douglas production function, the variance between high- and low-skilled labour and constructs theoretical models to analyse heterogeneous effects of environmental regulation intensity on the employment of labour with varied skills. The model finds that implementing environmental regulation will generate ‘compliance cost effect’ and ‘innovation offset effect’. The compliance cost effect will promote the employment of high-skilled labour while suppressing that of the low-skilled labour. The innovation offset effect, however, will facilitate the employment for both high-skilled and low-skilled labour. Therefore, the employment of high-skilled labour will grow along with the intensification of environmental regulation while that of the low-skilled labour will decline first and then rebound, showcasing a U-shaped curve. The empirical research results based on the provincial dynamic panel data from 2004 to 2018 in China confirm the theoretical analysis. Moreover, we find spatial spillover effects of environmental regulation on employment, with high-skilled labour being more sensitive to changes in environmental regulation. One percentage point increase in environmental regulation in neighbouring regions will cause 0.072% employment decline in high-skilled labour while that of low-skilled labour will only decrease 0.033%. The conclusions of this study verify that dividend in employment growth for both high-skilled and low-skilled labour can be realised along with intensification of environmental regulation, which carries significant guiding implications for policy-making for environmental regulation in China.

How does environmental regulation influence China’s carbon productivity? An empirical analysis based on the spatial spillover effect

Abstract: The rational implementation of environmental regulation and efforts to improve carbon productivity are the practical choices for China to address climate change. This paper mainly explores the correlations between environmental regulation and carbon productivity in China. The study first measures and analyzes carbon productivity and its changes. The results indicate that China’s carbon productivity experienced several fluctuations during the study period. Overall, the carbon productivity is currently in a stable rising phase. According to the empirical research on the basis of the spatial spillover effect, a positive spatial correlation exists between carbon productivity in the different regions of China, and there is a threshold for the impact of environmental regulation on carbon productivity. As the intensity of environmental regulation changes from weak to strong, its effect on carbon productivity in local regions will be affected and change from negative to positive. Similar effects will be seen in neighboring regions. At present, the average intensity of China’s environmental regulation has not yet reached this threshold. The eastern region’s average intensity of environmental regulation is closest to its threshold, while the average intensities of the central and western regions are far from their respective thresholds. There is great potential to improve China’s carbon productivity through the implementation of appropriate environmental regulations.

Critical factors for environmental regulation change management: Evidences from an extended producer responsibility case study

Abstract Contemporary environmental challenges have led governments to seek innovative ways to overcome the limits of traditional regulatory models, demanding a “change management”. This article addresses a case study regarding innovations promoted in the extended-producer responsibility (EPR) implementation by Sao Paulo state, Brazil. After facing resistance from industry, local government changed its approach from traditional regulation to negotiated agreements. As one of the researchers was an active part of the process, the Active Research method was adopted, through the changing as three steps model, aiming to understand how change occurs and what its critical factors (facilitators, barriers and improvement opportunities). Results indicate that the incorporation of the principles of regulatory quality has made it possible to overcome the gridlock and reopen the dialog, leading to agreements between industry and government. The evidence also shows that the EPR strategy has been continued and expanded, with the renewal of commitments with more ambitious goals, besides the inclusion of retailers in some EPR systems. Regulation has also evolved, with the incorporation of EPR in the environmental permitting, intending to combat free riders. Facilitators for change included recognition of the government, a gradual approach, cultural changes in companies and the systematization of information. Among the barriers, the most crucial were the low adherence of retailers and importers, the considerable presence of free riders, difficulties with the participation of municipalities, the absence of tax incentives, the low adhesion of generators, high operating costs, and collection problems. Finally, among the opportunities for improvement, results show the expansion of participants, mainly municipalities and retailers, a tax review, inclusion in environmental education programs, incorporation in environmental permitting, increased surveillance to combat free riders, and incentives to the recycling chain. Finally, the conclusions emphasize the success in incorporating principles of environmental regulatory quality in the Sao Paulo EPR implementation strategy. This fact strengthens the conclusions of previous research and suggests that its incorporation in policy design has the potential to overcome implementation gridlocks in complex environmental regulations.

Water crisis, environmental regulations and location dynamics of pollution-intensive industries in China: A study of the Taihu Lake watershed

Most existing studies on environmental regulations and the location dynamics of pollution-intensive industries regard new environmental procedures as an incremental development process, and neglect the influence of sudden changes in environmental regulations triggered by a pollution crisis. Using the drinking water crisis in the Taihu Lake Watershed (TLW) in 2007 as an example, this paper examines the spatial behavior of pollution-intensive firms across the TLW, and pays special attention to the regional differences in the effectiveness of enforcing environmental regulations. We find that the pollution haven hypothesis works efficiently in the short term after an unexpected pollution crisis because of the immediate strengthening of environmental regulations by local governments under pressure from the central government and the public. However, the effect of strict environmental policies was compromised by differences in the effectiveness of policy enforcement across the watershed. Specifically, when other regions (for example, Huzhou) were compared with Wuxi (the site of the crisis in the present study), these regions were found to be relatively insensitive to the effects of the pollution incidents and the environmental regulations that were triggered.