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Environmental Regulation Competition and Carbon Emissions
Lizhi Cui1,2, Yining Ding1, Xiangqian Li1
1School of Business, Anhui University of Technology, Ma'anshan 243032, China.
Summary
Environmental regulatory competition drives a "race to the top" among local governments, significantly reducing carbon emissions. This competition influences emissions through political assessments and industrial/technological improvements.
Area of Science:
- Environmental Economics
- Public Policy
- Game Theory
Background:
- Local governments engage in environmental regulatory competition, influenced by theories of environmental federalism and inter-local competition.
- Understanding this competition is crucial for effective carbon emission reduction governance.
Purpose of the Study:
- To analyze the strategic interactions in environmental regulatory competition.
- To determine the impact of this competition on carbon emissions.
- To explore the mechanisms through which environmental regulation competition affects carbon emissions.
Main Methods:
- Constructed a three-way evolutionary game model to explore strategic interactions.
- Applied the spatial Durbin model to test specific forms of competition and analyze effects.
- Examined the influence of political performance assessment, industrial structure, and technological capabilities.
Main Results:
- Identified strategic equilibria: "race to the bottom," "race to the top," and "differentiation of competition."
- Empirical evidence indicates a "race to the top" in environmental regulation competition post-2012.
- Increased environmental regulation intensity effectively inhibits carbon emissions, with the strongest effect observed in central regions.
Conclusions:
- Environmental regulatory competition, particularly a "race to the top," positively impacts carbon emission reduction.
- Mechanisms include political performance incentives, industrial upgrading, and enhanced low-carbon technology.
- Central government should balance interests, optimize performance assessments, and consider regional disparities for effective carbon governance.
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