Incentive-based environmental regulations and rural migrant workers' settlement intention: Insights from China's...

Rural migrant workers are vital in urbanization, and these workers' willingness to settle would be essential to achieve sustainable development in cities. This study explores the influence of the green fiscal policies, such as the Energy Saving and Emission Reduction Fiscal (ESERF) policy, on the settlement intentions of rural migrant workers in China. (1) Utilizing data from the China Migrant Dynamics Survey and Difference-in-Differences (DID) approach, we discovered a significant positive effect of the ESERF policy, which increases rural migrant workers' propensity to settle in cities by 5.19 %. This effect is further amplified by vigorous policy enforcement and is mediated by improvements in environmental quality, employment opportunities, and public service access. (2) Our heterogeneity analysis reveals that the policy's benefits are disproportionately more excellent for rural migrant workers facing higher living costs, longer migration distances, and lower initial social integration. Cities with higher settlement costs, unique cultural identities, and better governance capacity also experience enhanced benefits. (3) Moreover, the synergistic effects of combining incentive-based green fiscal policies with market-based or engagement-based environmental regulations policies suggest that such integrative approaches can substantially enhance rural migrant workers' willingness to urbanize permanently. Our results will, therefore, contribute to the literature on how green fiscal policies have multiple benefits to help influence the intentions of settling migrants and eventually provide a persuasive argument for their strategic implementation in facilitating sustainable urban development.