No abstract

This study investigates the impact of stricter environmental regulation on export exit behavior of Chinese manufacturing firms from 1998 to 2009. After controlling heterogeneous firm, we find that (i) on average, the stricter regulation has not significantly caused more export exit; (ii) under stricter policy, foreign invested pure (or pollution intensive) exporters are not more likely to exit export than domestic pure (or pollution intensive) exporters; (iii) only weak evidence supports the pollution haven hypothesis for domestic pure exporters. All our robustness checks such as difference in difference analysis, different regulation measurement, and matched firm analysis show similar results.