A study on the differential effects of heterogeneous environmental regulations on the green transformation of Chinese manufacturing enterprises under "Double Carbon" target

Using panel data of Chinese manufacturing enterprises listed in Shanghai and Shenzhen A-shares from 2015 to 2021, we examine the effects of heterogeneous environmental regulations on the green transformation of Chinese manufacturing enterprises under "Double Carbon" target, and reveal the mediating role played by managers' green perception in the process from an intra-firm perspective. We find that three environmental regulation tools, namely environmental administrative supervision, environmental economic regulation and environmental soft constraint, all contribute significantly to the green transformation of manufacturing enterprises. Among them, environmental economic regulation is the most effective in promoting the green transformation of manufacturing enterprises, followed by environmental soft constraint and environmental administrative supervision. The mechanism analysis shows that managers' green perception is partially mediated between heterogeneous environmental regulations and the green transformation of manufacturing enterprises. Moreover, environmental administrative supervision is the most effective in raising managers' green perception among them, followed by environmental economic regulation and environmental soft constraint. Further analysis shows that the positive effect of heterogeneous environmental regulations on the green transformation of Chinese manufacturing enterprises is more significant when the enterprises locate in regions with high policy uncertainty, in the eastern part of the country, or when the enterprises are state-owned enterprises. The conclusions provide a theoretical basis for Chinese environmental policymakers to flexibly adopt differentiated environmental regulation tools.

Non-linear effects of heterogeneous environmental regulations on industrial relocation: Do compliance costs work?

Reasonably designing environmental regulations for compliance-driven industrial relocation can avoid new pollution havens. The Cournot duopoly model simulates that the necessary condition for industrial relocation is differentiated market costs. Then, based on the province-industrial data of six Chinese pollution-intensive industries during 2005-2019, this study applies spatial Durbin model to explore the non-linear effects of heterogeneous environmental regulations on industrial relocation. Results shown that command-and-control environmental regulation manifests a U-shaped curve with local industrial relocation, with inverted U-shaped spillover effect radiating a road distance of 650 km, and both internal and external costs play the mediating roles; Market incentive environmental regulation has inverted U-shaped curves with industrial relocation in local and neighboring regions, it creates dual costs and works well in both short and long terms, which is the most potential regulatory tool to avoid pollution relocation accompanying industrial relocation; Voluntary environmental regulation exhibits inverted U-shaped relationships with industrial relocation in direct and spillover effects, and works through increased external cost rather than internal cost. Its spatial spillover radiates the longest 1250 km due to rapid spread of public opinions, but this effect takes more than 3 years to be effective.

Non-linear effects of heterogeneous environmental regulations on green growth in G20 countries: Evidence from panel threshold regression

A comprehensive understanding of the relationships between environmental regulations and green growth of economy is essential for policy design and decision-making. This paper combines hybrid measure with Global Malmquist Luenberger index to estimate national green growth level. A panel threshold regression technique is then employed to observe the non-linear impacts of both the formal and informal environmental regulations on green growth in Group 20 countries during 2001-2015. Results from empirical tests reveal that, for the formal environmental regulations represented by Environmental Policy Stringency (EPS), the market-based EPS is only significant at high-level phase while this is not the case in the low-level counterpart; non-market based EPS witnessed significant signs across the three phases, but in varied coefficients and significance levels. By comparison, the informal environmental regulations represented by environmental-related technologies and education levels show positive and significant impact on green growth, except for the case when countries have higher level of technologies. In addition, income per capita and gross Research & Development (R&D) expenditures present significant positive impacts on the dependent while share of service sector to the economy and investment on transport infrastructure witnessed negative effects across the models. Policy implications are proposed thereafter, although both the formal and informal environmental regulations are important to promote green growth, but they show different impacts at different phases.