The dilemma of paraxylene plants in China: Real trouble for the environment?

The impact of environmental supervision on firms' energy efficiency: evidence from the Environmental Protection Admonishing Talk policy in China

Enhancing energy efficiency is an important issue for countries facing pressures from energy shortages and environment pollution. Given increasing interest in the role of environmental supervision and the current lack of empirical evidence on this topic, this study investigates the impact of environmental supervision on firms' energy efficiency by taking the Environmental Protection Admonishing Talk (EPAT) policy in China as a quasi-natural experiment. Using the difference-in-differences method and the panel data of more than 3 million firms in China from 2008 to 2016, we find that environmental supervision improves firms' energy efficiency. This finding is validated by robustness tests and the difference-in-differences method combined with propensity score matching. The EPAT policy has varying effects on firms based on their location and size. A mechanism analysis shows that the EPAT policy improves firms' energy efficiency mainly by incentivizing them to adopt new technologies and transforming their modes of production. These findings can provide novel microscopic evidence on environmental supervision and energy efficiency and offer clues for the improvement of environmental enforcement in developing countries.

The Dual Impacts of Green Credit on Economy and Environment: Evidence from China

Green credit is regarded as an important means to promote sustainable growth. Based on the provincial panel dataset of China from 2007 to 2017, this paper investigates the dual impacts of green credit on the economy and environment, and it establishes mediating effect models to analyze the Porter hypothesis. The results show that the green credit policy significantly improves economic performance and reduces pollutant emissions. The above results are robust to employing methods with alternative variables and instrumental variables. Second, the green credit policy contributes to innovation; that is, the green credit increases the innovation scale and improves innovation efficiency. The results of mediating effect models suggest that the Porter effect of green credit can be achieved by improving innovation efficiency. The findings of the current study indicate that the green credit policy helps achieve the win–win situation for economic goals and environmental targets.