Environmental Regulation Policies Research Articles

The Impact of Environmental Protection Investment and Equity Balance Degree on Economic Performance and Eco-Autonomy: An Empirical Study of China’s A-Share Listed Companies

Enterprises are not only the main source of energy consumption and pollution emissions but also a key force in environmental governance. There is no doubt that the positive impact of enterprise environmental protection investment (EPI) on other stakeholders, but the impact on its own economic performance is the key to determining the scale of EPI and increasing the motivation for Eco-autonomy. This paper selects 691 companies listed on China’s A-share market from 2012 to 2022 as research samples, introducing the equity balance degree as the moderator variable, and empirically investigating the impact of the relationship by using a panel multivariate regression model. The results show that the relationship between EPI and its economic performance is a U-shaped curve, and it is related to Eco-autonomy. The equity balance degree can mitigate the negative influence of the relationship, but it is significantly different between state-owned enterprises and private enterprises. Accordingly, it prompts the following policy implementation: the Chinese government should develop differentiated environmental incentives and regulatory policies. It should focus on private enterprises with high-equity balance degrees and high pollution levels, and it should encourage state-owned enterprises to increase the scale of ex ante preventive investment through policy incentives.

Options for environmental regulation policy under China's carbon peaking target: Energy supply policy or carbon tax policy?

China plans to achieve the carbon peaking target by 2030 and will maybe implement a series of environmental regulation policies, primarily including energy supply policy (such as coal consumption constraint and non-fossil energy development) and carbon tax policy. This paper simulates these policies using a computable general equilibrium model. The simulation results indicate that carbon tax policy has a finite impact on the economy, the emissions reduction effect is also limited and carbon tax policy alone is insufficient to achieve China's 2030 carbon peaking target. The coal consumption constraint policy has a good emissions reduction effect, but is not conducive to economic growth. The non-fossil energy development policy can increase energy supply and promote economic growth, but the emissions reduction effect is inadequate. In general, the simultaneous implementation of the coal consumption constraint and non-fossil energy development policies could not only achieve the carbon peaking goal, but also narrow the energy gap and reduce pressure on economic growth. However, it is notable that if carbon tax policy and energy supply policy are implemented simultaneously, the emissions reduction effect of carbon tax policy would be significantly reduced; therefore, it is likely that no carbon tax will be levied in China.

Does environmental regulation matter for healthcare utilisation in China? An interrupted time series study.

In recent years, China has implemented a series of environmental regulation policies to improve air quality, but the health effects of these policy changes need to be accurately clarified and quantified. The objective of this study was to empirically examine the effects of levying construction dust pollution fees on healthcare utilisation in a southern city of China. The study used a unique administrative insurance claim dataset from the city's Urban Employee Basic Medical Insurance scheme between 2013 and 2015. The sample included 69,961 enrolees. An interrupted time series design was employed to investigate whether and how the healthcare utilisation of enrolees changed after the policy change. The results showed that this environmental regulation policy did not affect the inpatient utilisation of enrolees but did negatively impact outpatient utilisation. In addition, outpatient utilisation of chronic disease coverage decreased for patients with chronic diseases, including diabetes and hypertension. This study provides evidence that enhancing environmental regulations helps reduce medical costs, which can benefit China and other developing countries to improve environmental quality and promote public health.

Green Technology Innovation Guiding Policies under the Synergy of Government and Financial Institutions

Guiding enterprises towards green technology innovation (GTI) is a pivotal strategy for mitigating pollution and energy wastage, thereby facilitating the transition towards a green and low-carbon economy. In order to solve the single irrationality of the existing guidance policy and improve its implementation effect, parameters of environmental regulation and green credit policy are hereby introduced to construct a tripartite evolutionary game model of the government, financial institutions, and enterprises. The evolutionary stability of the government and financial institutions in guiding enterprises' GTI is analyzed. Simulation analysis method is used to visualize the evolution path of the game system under different policy options. The study results show that increasing interest rate subsidies can promote the financial institutions and the government to formulate GTI guidance policies. Besides, there is a significant synergistic effect between interest rate subsidies and green credits, which can efficiently foster GTI within enterprises and decrease their innovation costs. Building on this foundation, further increasing the carbon tax rate can lead to a reduction in government subsidy expenditures, improve the evolution rate of the ideal strategy, and expedite the realization of a green, low-carbon transformation.

Does the environmental tax affect the within-firm pay gap? Evidence from China

The impact of the environmental tax on internal income distribution within firms is a crucial extension for evaluating the economic effects of environmental regulation policies. However, the existing literature focuses primarily on environmental effects and the Porter hypothesis, giving little attention to this topic. Using data from Chinese A-share listed companies from 2018 to 2021, we examine how the Chinese environmental protection tax affects intrafirm wage disparities. Our findings indicate that the environmental tax widens the pay gap between managerial and ordinary employees. Mechanism tests show that the environmental tax's governance effect raises managerial compensation levels, whereas cost effects decrease wages for ordinary employees. This effect is particularly pronounced in nonstate-owned firms, competitive industries, and regions with stricter environmental tax collection standards. This study makes an empirical contribution to our understanding of the effects of the environmental tax on income distribution in practice.

Market‐incentivized environmental regulation policy and company green transformation: An analytical perspective based on the cost transfer capability of companies

AbstractBased on the carbon emissions trading pilot policy in China, this paper takes Chinese A‐share listed companies from 2012 to 2020 as a sample, and analyzes the role of company's cost transfer capability (ECTC) in the mechanism of market‐incentivized environmental regulation policy (MERP) influencing company green transformation. This paper finds the following four primary results. First, ECTC significantly strengthens the green transformation driving effect of MERP in general. However, results based on the division of ECTC by percentiles show that MERP‐induced green transformation is more pronounced in the top 25% of companies, which distinguishes them from companies in the top 25%–50%, whose cost transfer capacity hampers MERP's contribution to the green transformation. Second, the level of regional economic development, emission regulation, and business reputation have heterogeneous influences on the moderating effect of ECTC. Third, the results based on the moderated mediation model show that ECTC can influence the green transition driving effect of MERP by moderating the two paths of risk‐taking ability and financing constraints of companies. Finally, there is a diffusion effect on the green transformation driven by MERP through cost transfer among companies in non‐pilot industries and non‐pilot regions.

China's Low-carbon city policy and manufacturing firms' servitization: Do environmental regulations matterʔ

Manufacturing servitization is an effective way to improve both environmental performance and economic benefits in developing countries. In this paper, we first propose the firm-level manufacturing servitization (FMS) measurement method. Then, based on Chinese firm-level data for 2000–2015, we take low-carbon city pilot (LCCP) policy implementation as a quasi-natural experiment to investigate the effect of low-carbon city governance on FMS. The propensity score matching-difference-in-differences (PSM-DID) model results indicate that the construction of LCCP policy could significantly improve FMS. In addition, we explain the promoting effect of low-carbon city governance on FMS by enhancing innovation intensity and promoting pollution factor substitution. Specifically, low-carbon city governance increases the innovation intensity of enterprises and promotes service factors as substitutes for other pollution production factors, changing the service factor input structure. Furthermore, by dynamically decomposing aggregate FMS growth, we found that LCCP policy generates a positive within-firm effect for surviving enterprises. However, the role of the resource reallocation effect has not been fully explored. Based on the findings, this study offers more theoretical backing and empirical substantiation for developing countries' pursuit of simultaneously achieving sustainability and economic growth under environmental regulations.

Research on the impact of FDI and environmental regulation on the industrial structure upgrading in the Yellow River Basin

Introductions: Since the reform and opening up, the inflow of foreign direct investment (FDI) has provided a steady stream of capital, technology, talent and other resources for the development of the Yellow River basin, while caused problems such as environmental pollution, ecological fragility and industrial structure upgrading difficulties to some extent. Environmental regulation is a pivotal initiative to achieve mutual harmony between ecological environment and economic development, which could enhance the quality of the introduction of FDI and accelerate the green transformation of the development mode.Methods: Based on urban panel data from 2006–2019, this study empirically examined the impact of FDI and environmental regulation on industrial structure upgrading in the Yellow River Basin. Moreover, taking environmental regulation as a threshold variable, a panel threshold model was established to further explore the role of environmental regulation in the impact of FDI on industrial structure upgrading in the Yellow River Basin.Results: (1) The relationship between FDI and industrial structure upgrading in the Yellow River Basin is not a simple linear relationship, but an inverted “U”-shaped relationship that rises first and then falls, and the results of this inverted “U”-shaped relationship are still robust after replacing key indicators. (2) The environmental regulation policy has a driving effect on the upgrading of industrial structure in the Yellow River Basin. (3) Environmental regulation has a positive role in the influence of FDI on the industrial structure upgrading in the Yellow River basin, and the positive role increases gradually as the intensity of environmental regulation increases moderately, but if the intensity of environmental regulation is too high, it will have a negative impact on the upgrading of industrial structure in the Yellow River basin to some extent.Discussion: In the future, policymakers should make reasonable and effective use of FDI and improve the quality of FDI; reasonably formulate environmental regulation policies; coordinate the intensity of FDI and environmental regulation; thus, bring into play the promotion effect of FDI and environmental regulation on industrial structure upgrading, and then realize the win-win of ecological protection and high-quality economic development in the Yellow River Basin.

Patterns of environmental regulation and green innovation in China

Green technology innovation is an important means to achieve sustainable development. The study is an exploration of the bilateral perspective on the relationship between different types of environmental regulations and green innovation. Based on the data set of 30 provinces in China from 2006 to 2018, the two-sided effects of command-and-control environmental regulation and market-based environmental regulation on green innovation are analysed and the net effects are calculated by using the two-tier stochastic frontier models. First, empirical research shows that the effects of command-and-control environmental regulation and market-based environmental regulation on green innovation are both highlighted by negative characteristics. Command-and-control environmental regulation has a smaller effect on green innovation, with an average positive effect of 0.00005, which is smaller than the average negative effect of 0.0008. Meanwhile, the positive effect of market-based environmental regulation on green innovation is 0.00291, smaller than the negative effect of 0.00461. Second, the negative impact of command-and-control environmental regulation on green innovation underwent a "back-to-N" change process in 2006–2018, while the negative effect of market-based environmental regulation on green innovation did not decline until after 2011. Third, the provinces where command-and-control environmental regulation policies have a greater negative effect are concentrated in the energy-intensive regions of central and western China, while the provinces where market-based environmental regulation policies can promote green innovation are from the energy-intensive or developed eastern regions of China. Based on the research conclusions, to better promote green innovation, there is a need to implement environmental regulatory policies that address regional differences and to establish a national system of green innovation markets.

The impact of low-carbon city pilot on carbon emissions of high-polluting enterprises − Based on financing constraint perspective

As the major contributor to climate change, enterprises in high-polluting industries have a large deal of potential to reduce their carbon emissions, and the efficacy of that reduction is correlated with the nation's overall environmental pollution and climate change. As a comprehensive environmental regulation policy, whether the low-carbon city pilot (LCCP) can promote the carbon emission reduction of high-polluting enterprises remains to be verified. Based on the data of all high-polluting listed companies in China during the period of 2010–2020, this study evaluates the implementation effect of the LCCP through the multi-period difference-in-differences model, and conducts a series of robustness tests. In addition, the implementation path, heterogeneity and industry spillover effects of the policy are also studied. The study shows that the LCCP policy significantly reduces the growth rate of carbon emissions of enterprises in high-polluting industries by 1.06 percentage points on average. Financing constraints play a negative moderating role between the LCCP and the growth rate of carbon emissions. The mechanism test demonstrates that the LCCP reduces the carbon emission growth rate of enterprises in high-polluting industries through enterprise technological innovation and increasing environmental protection investment level. Further analysis can also find that the LCCP has a more obvious emission reduction effect on state-owned enterprises and enterprises in areas with lax environmental law enforcement. And there is an economic spillover effect but no industrial spillover effect. In view of this, local governments should play a guiding role in the policy, continue to expand the scale of the LCCP and focus on non-state-owned enterprises to promote the green transformation of high-polluting enterprises. This study offers significant theoretical and practical reference value for the further implementation of environmental regulation in the field of environmental governance and the reduction of enterprise carbon emissions.

Analysis of the multiple drivers of vegetation cover evolution in the Taihangshan-Yanshan region

The Taihangshan-Yanshan region (TYR) is an important ecological barrier area for Beijing-Tianjin-Hebei, and the effectiveness of its ecological restoration and protection is of great significance to the ecological security pattern of North China. Based on the FVC data from 2000 to 2021, residual analysis, parametric optimal geodetector technique (OPGD) and multi-scale geographically weighted regression analysis (MGWR) were used to clarify the the multivariate driving mechanism of the evolution of FVC in the TYR. Results show that: (1) FVC changes in the TYR show a slowly fluctuating upward trend, with an average growth rate of 0.02/10a, and a spatial pattern of "high in the northwest and low in the southeast"; more than half of the FVC increased during the 22-year period. (2) The results of residual analysis showed that the effects of temperature and precipitation on FVC were very limited, and a considerable proportion (80.80% and 76.78%) of the improved and degraded areas were influenced by other factors. (3) The results of OPGD showed that the main influencing factors of the spatial differentiation of FVC included evapotranspiration, surface temperature, land use type, nighttime light intensity, soil type, and vegetation type (q > 0.2); The explanatory rates of the two-factor interactions were greater than those of the single factor, which showed either nonlinear enhancement or bifactorial enhancement, among which, the interaction of evapotranspiration with mean air and surface temperature has the strongest effect on the spatial and temporal evolution of FVC (q = 0.75). Surface temperature between 4.98 and 10.4 °C, evapotranspiration between 638 and 762 mm/a, and nighttime light between 1.96 and 7.78 lm/m2 favoured an increase in vegetation cover, and vegetation developed on lysimetric soils was more inclined to be of high cover. (4) The correlation between each variable and FVC showed different performance, GDP, elevation, slope and FVC showed significant positive correlation in most regions, while population size, urban population proportion, GDP proportion of primary and secondary industries, and nighttime light intensity all showed negative correlation with FVC to different degrees. The results can provide data for formulating regional environmental protection and restoration policies.

The disappearance of pollution havens under unified environmental regulation: evidence from China’s pig industry

ABSTRACT Since 2014, China has implemented a unified environmental regulation policy for the livestock industry. With unified environmental regulations across provinces, does the phenomenon of ‘pollution havens’ still exist? To address this question, this paper examines spatial variations among provinces and their spillover effects on the pig industry using data on environmental regulations and pig production panels. The results indicate that: (1) Environmental regulation policies are gradually converging across regions. (2) Under unified environmental regulation, the existence of ‘pollution havens’ in the pig industry is no longer evident. As national regulations become stronger, increasing local regulatory intensity will not affect the number of pig farms in neighboring areas nor lead to significant emigration of such farms. (3) In cases where there are inter-regional variations in environmental regulations, large-scale farmers may relocate to neighboring areas with less stringent regulations; however, under unified environmental regulation, neither small nor large-scale farmers will migrate.

Can Social Learning Promote Farmers’ Green Breeding Behavior? Regulatory Effect Based on Environmental Regulation

Farmers’ green breeding behavior is significant to environmental protection and sustainable development. Based on the micro-survey data of 1248 beef cattle farmers in Inner Mongolia Autonomous Region and Jilin Province, the OLS model and regulatory effect tests are used to analyze the influence of social learning on farmers’ green breeding behavior and to verify the mechanism of environmental regulation. Key findings include the following: (1) Social learning has a significant positive impact on farmers’ green breeding behavior. (2) Social learning has a significant positive impact on farmers’ willingness to undertake green breeding, farmers’ specific behavior of green breeding, and farmers’ continuous green breeding, among which the effect on specific behavior of green breeding is the most positive. (3) Environmental regulation plays a moderating role in the relationship between social learning and farmers’ green breeding behavior, among which all sub-dimensions of environmental regulation (incentive-based environmental regulation, binding environmental regulation and guided environmental regulation) have positive reinforcing effects, especially the most significant reinforcement effect of binding environmental regulation. Based on the research conclusions, this study proposes policy suggestions such as strengthening the training of farmers, strengthening the learning and communication among farmers’ neighbors, increasing the frequency of farmers’ use of mass media, improving the environmental regulation policy system, and promoting the coordinated development of environmental, economic, and social benefits.

Environmental regulation and labor demand: Evidence from China's air pollution prevention and Control Action Plan

In response to environmental regulatory pressure from the government, enterprises – as the main employers of labor – adjust their production-related choices and may alter their demand for labor. Numerous researches have probed into how environmental regulations affect the labor demand, which has emerged as a significant concern in the discourse around the adoption of environmental regulation policies. Nonetheless, many researches predominantly concentrates on the evaluation on the effects of environmental regulations on economic and environmental levels. Moreover, rare attention has been paid to how environmental regulations affect social activities, especially in terms of labor demands. As a result, the Air Pollution Prevention and Control Action Plan (APPCAP) is adopted as a “quasi-natural experiment” and a difference-in-differences model is employed to analyze the effects of the APPCAP on labor demands of companies. Hence, the 2008–2020 panel data are considered for the 3,949 Chinese A-share listed enterprises. Furthermore, this paper probes deeply into the underlying mechanisms based on mediation models. The following findings are thus concluded: (1) The labor demands of enterprises can be remarkably increased by APPCAP; and the result is still persuasive even though the endogeneity issues are taken into account. (2) APPCAP improves enterprise labor demand through the output and factor substitution effects. (3) As evidently revealed by heterogeneity analysis, the APPCAP could significant positive affect the labor demand size in state-owned companies, large-scale companies, new companies, and companies in polluting industries. (4) The APPCAP strikingly boosts the demand for labor force with high skills. Nevertheless, it exerts little influence on the demand for labor force with low skills and company salary levels. Therefore, the government must continue to steadfastly implement environmental regulatory policies but adopt different policies based on enterprise characteristics. Overall, this study provides micro-level experimental evidence for more in-depth understanding of how environmental policies affect labor market, which is particularly important for actively resolving social employment problems and exploring new growth points in enterprise employment.

The impact of environmental regulations on the green development of the mariculture industry: empirical analysis based on provincial panel data in coastal areas of China.

With the continuous increase in global mariculture production and aquaculture areas, the environmental pollution caused by the mariculture industry is becoming increasingly serious. Faced with environmental issues, countries worldwide have formulated environmental regulations to scientifically intervene in marine environmental pollution issues and promote the green development of the mariculture industry. However, we must determine if strict environmental regulations can effectively promote the green development of the mariculture industry. This article uses the inter-provincial panel data of China's coastal areas from 2003 to 2019 as a sample. We use the entropy-technique for order of preference by similarity to ideal solution method to measure the intensity of environmental regulation in China's coastal areas and the level of green development of the mariculture industry. On this basis, an economic geography nested matrix was selected to construct a spatial panel econometric model to empirically explore the impact of environmental regulations on the green development of the mariculture industry. This approach also allows us to examine the heterogeneity of the impact of different types of environmental regulations on the green development of the mariculture industry. The research results indicate that environmental regulations have a "U-shaped" impact on the green development of the local mariculture industry, while they have an inverted "U-shaped" impact on the green development of the nearby mariculture industry. Furthermore, heterogeneity exists in the impact of different types of environmental regulations on the green development of the mariculture industry. Based on the research results, this article proposes policy recommendations from the perspectives of flexibly adjusting the intensity of environmental regulations, accelerating the development of voluntary-based environmental regulations, and regulating competition among local governments, which can provide decision-making references for the government to adjust environmental regulation policies and improve the level of green development in the mariculture industry.

Facilitation or inhibition? Government environmental attention and corporate green technology innovation

Corporate green technology innovation (GTI) is an effective way to solve environmental problems and achieve the goal of sustainable development. It is of great theoretical significance and strategic value to explore the influence of government behavior on corporate GTI. Based on institutional theory and attention theory, this study empirically examines the impact of government environmental attention (GEA) on corporate GTI by using data for China’s A-share listed companies from 2010 to 2021. We find that GEA can significantly promote corporate GTI, and there are four channels of action: strengthening environmental regulatory policies, increasing green investment, strengthening environmental information disclosure, and enhancing corporate social responsibility. Moreover, executive environmental experience, public environmental participation and social media attention positively moderated the impact of GEA on firms’ GTI. Heterogeneity analyses show that these positive effects are more significant in regions with low enforcement intensity, eastern regions, heavily polluted industries and state-owned firms. We also find that GEA can significantly enhance the efficiency and quality of GTI in enterprises, as well as encourage GTI among heavily polluting firms. GTI positively affects enterprise value, total factor productivity, and also improves enterprise environmental performance. Our results provide direct evidence from developing countries that GEA promotes GTI, and also provide theoretical support and decision-making references for further improving environmental policies and achieving sustainable development.

Will carbon emission trading scheme affect industrial investment? Evidence from China’s listed companies

ABSTRACT Using data from A-share listed companies in China spanning the years 2008 to 2020, this study constructs a Staggered Difference-in-Differences (DID) model to estimate the influence of the Carbon Emission Trading Scheme (ETS) on industrial investment, based on signalling theory, financing constraint theory and capital structure theory. The main findings are summarized as follows: Firstly, the implementation of ETS is observed to enhance industrial investment levels within listed companies located in pilot areas. This finding is confirmed through a series of robustness tests that further validate its credibility. Secondly, the analysis of mechanisms reveals that the positive effect of ETS on industrial investment is due to its ability to improve the environmental performance and market value of listed companies. These findings provide empirical evidence and valuable insights for assessing the efficacy of environmental regulation policies and refining the ETS framework.

How does carbon biased technological progress promote carbon haze collaborative Governance？Evidence from Chinese cities

Carbon dioxide (CO2) emissions and haze pollution are often thought to have the same origin, the burning of fossil fuels. However, their relationship is not always synergistic and may even exhibit mutual constraints. Carbon-biased technological progress has emerged as a promising approach for simultaneously achieving three goals – to reduce CO2 emissions, alleviate the haze pressure, and keep economic growth. This study empirically investigates the impact and mechanisms of carbon-biased technological progress on carbon haze collaborative governance using data from 286 Chinese cities during 2006–2021. The results indicate that: (1) Carbon biased technological progress positively influences carbon haze collaborative governance. (2) This progress achieves coordination by enhancing element allocation efficiency, carbon efficiency, and responding to public environmental demands. (3) The facilitating role of carbon biased technological progress to carbon haze collaborative governance will work better if external conditions are met. Moreover, the effectiveness of carbon-biased technological progress in promoting coordination is contingent upon high levels of marketization, government intervention, environmental regulation, and technical advancements. Local and regional governments should foster conducive conditions for carbon dioxide and haze pollution coordination, optimize the allocation and flow of carbon resources, ensure harmonization between environmental regulation policies and other sectors, and bolster international cooperation and technical knowledge exchange to collectively address global environmental challenges.

Coordination of interests between local environmental protection departments and enterprises under China’s environmental regulation policies: an evolutionary game theoretical approach

The Central Inspection for Ecological and Environmental Protection (CIEEP) and Environmental Vertical Management Reform (EVMR) policies have reshaped the relationships among stakeholders and the power structure in local environmental governance systems. To reveal the current local environmental collaborative governance mechanism, this study placed CIEEP and EVMR policies within the same research framework and considered multiple governance entities, including the central government, higher-level environmental protection departments, local environmental protection departments, enterprises, and the public, employing evolutionary game theory and numerical simulation techniques to explore the boundary conditions, key influencing factors, influence mechanisms, and realization paths of local environmental collaborative governance from a dynamic process perspective. The results show that: 1) The cost of enterprise environmental behavior, intensity of reward and punishment for enterprise environmental behavior, government subsidies, supervision cost of local environmental protection departments, and intensity of reward and punishment for local environmental protection departments all have important effects on local environmental governance; 2) Compared with the cost of enterprise environmental behavior, enterprise environmental behavior is more sensitive to changes in supervision cost of local environmental protection departments, and the intensity of reward and punishment for enterprise environmental behavior has the same major impact on enterprise environmental behavior as that of local environmental protection departments; 3) The influence of CIEEP policy on enterprise environmental behavior is unstable, showing signs of strategic response. Therefore, local environmental governance systems should be further optimized by encouraging local environmental protection departments to actively supervise and designing differentiated policy tools. This study provides a reference for solving local environmental governance problems under current environmental regulation policies.

Does Environmental Regulation Affect Circular Economy Performance? Evidence from China

Environmental regulation is an important means to solve the environmental pollution challenges faced by economic development. Under the predicament of economic growth facing enormous environmental challenges, this paper aims to explore whether environmental regulation has a promoting effect on the circular economy performance, construct the mechanism through which environmental regulation impacts circular economy performance, as well as test regional heterogeneity on the impact of environmental regulation on circular economy performance under different levels of economic development. Exploring these factors is of great significance for meeting people’s demand for better living environments and promoting green and sustainable economic development. This paper takes interprovincial panel data of China from 2011 to 2022 as the sample and adopts structural equation modeling to explore the influence mechanism of environmental regulation on circular economy performance by constructing a measurement system of environmental regulation and circular economy performance. The results indicate the following: environmental regulation has a significant role in promoting circular economy performance, and there is a partial mediating effect of industrial structure upgrading within it; heterogeneity analysis shows that the promoting effect of environmental regulation on circular economy performance varies according to the different levels of regional economic development. Therefore, environmental regulation policies should be moderately adjusted to promote balanced economic and environmental development; environmental regulation policies should be enriched to promote industrial structure transformation and upgrading; regional synergistic governance should be improved to facilitate the promotion of the circular economy.