• ISSN: 2010-023X (Print)
    • Abbreviated Title: Int. J. Trade, Economics and Financ.
    • Frequency: Quaterly
    • DOI: 10.18178/IJTEF
    • Editor-in-Chief: Prof.Tung-Zong (Donald) Chang
    • Managing Editor: Ms. Shira. W. Lu
    • Abstracting/ Indexing:  Crossref, CNKI, EBSCO
    • E-mail: ijtef.editorial.office@gmail.com
IJTEF 2022 Vol.13(2): 47-51 ISSN: 2010-023X
DOI: 10.18178/ijtef.2022.13.2.722

Does Environmental Regulation Affect Economic Growth and Restructuring? Evidence from a Quasi-Natural Experiment in China

Zewei Yao

Abstract—Our study is relevant to the large literature on pollution regulations, especially to the studies on developing countries. Previous studies in U.S. have found that tougher air pollution regulations resulted in substantial welfare losses. Some earlier studies in China focused on the environmental performance with the environmental monitoring by the government and showed some significant effect on the overall environmental quality over the monitoring periods (see Guo et al., 2017, Zheng and Kahn, 2013). This paper also complements the existing studies examining the effect of environmental regulations especially TCZ policy in China. Cai et al. (2016) finds that TCZ policy caused a decline in FDI in TCZ cities, and the effect is much stronger in more polluting industries. Hering and Poncet (2014) shows there is a relative fall in exports of both foreign and private firms in TCZ cities, while state-owned firms are less intensively affect. Our result shows a relative rise in GDP in TCZ cities, which suggests tougher environmental regulation increases the local GDP growth. This result partially supports the “Porter Hypothesis” that a well-designed environmental regulation can lead to a “win-win” situation of environmental quality and economic growth.

Index Terms—Component, environmental regulation, economic growth, quasi-natural experiment, China.

Zewei Yao is with BNU-HKBU United International College, Zhuhai, Guangdong, China (e-mail: zewei_yao@ x-az.com).


Cite: Zewei Yao, "Does Environmental Regulation Affect Economic Growth and Restructuring? Evidence from a Quasi-Natural Experiment in China," International Journal of Trade, Economics and Finance vol.13, no.2, pp. 47-51, 2022.

Copyright © 2022 by the authors. This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited (CC BY 4.0).


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