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Can China's Environmental Regulations Effectively Reduce Pollution Emissions?

Xi Chen1,2, Zhigang Chen1,2

  • 1Institute of Central China Development, Wuhan University, Wuhan 430072, China.

International Journal of Environmental Research and Public Health
|April 30, 2021
PubMed
Summary

Environmental regulation

Keywords:
environmental regulationgreen technological progressimpulse functionnonlinear regressionpollution emissions

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Area of Science:

  • Environmental Economics
  • Econometrics
  • Sustainable Development

Background:

  • Environmental regulation effectiveness is crucial for sustainable development.
  • Understanding the dynamic mechanisms of pollution emission is key.
  • China's provincial panel data (2006-2017) provides a robust basis for analysis.

Purpose of the Study:

  • To investigate the non-linear effects of environmental regulation on pollution emissions.
  • To identify threshold variables influencing environmental regulation effectiveness.
  • To explore the dynamic transformation mechanisms of pollution emission under regulation.

Main Methods:

  • Panel Smooth Transition (PSTR) model applied to Chinese provincial data.
  • Analysis of threshold effects using technological progress, economic growth, and foreign direct investment (FDI).
  • Slacks-based measure (SBM) and Global-Malmquist-Luenberger index for biased technological progress.
  • Panel Vector Auto Regressive (PVAR) algorithm for relationship verification.

Main Results:

  • Environmental regulation exhibits a significant non-linear impact on pollution emissions, with technological progress as the optimal threshold variable.
  • Environmental regulation demonstrates a substitution effect on pollution discharge, with stronger emission reduction in areas with advanced technology and high FDI.
  • The emission reduction effect is less pronounced in high economic development areas compared to low-system areas.

Conclusions:

  • Technological progress and FDI initially positively impact environmental regulation, shifting to negative effects over time.
  • Economic growth's positive impact on environmental regulation is diminishing.
  • Findings offer guidance for implementing effective environmental regulations for governments and corporations.