Consequences and Drivers of Differentiated Environmental Regulation Policies on Hog Production in China: A Spatial Econometrics Approach

Abstract

Using a spatial econometric approach and national prefecture-level hog inventory data, this paper analyzes the extent to which environmental regulation policies influence hog production in China, and obtained the following research results: 1) During the 12th Five-Year Plan period, environmental regulation policies will significantly reduce the output of the hog industry in highly regulated areas. 2) The specific policy commands from the central government targeting on livestock sector and a high share of agriculture in the economy will increase the stringency of the environmental regulation policies on hog production. 3) The COD emission reduction requirements also have a significant negative impact on major hog farming provinces, the results obtained from the main model are verified again. The results highlight the importance of a more flexible environmental decentralization regime in China and other developing countries for future reforms.

The Unintended Impact of Environmental Regulation on China’s Hog Sector

“…Hog production. In this study, we followed the approach of previous studies [5,6] in using the number of stocked heads as an indicator of hog production. Specifically, we used the natural logarithm of yearend hog stock in each county as the outcome measure.…”

“…Existing studies have shown that environmental regulations can negatively impact hog production, leading to a reduction in the number of hogs slaughtered, live hog inventory, and pork production by 8.3%, 10.3%, and 11.2%, respectively [5]. Zeng et al (2022) [6] used a spatial econometric approach to show that these regulations significantly impact the hog industry in highly regulated areas. These studies evaluating hog-relocation policies and regulations have consistently shown that such regulations lead to reduced animal numbers rather than the relocation of production capacity [5,6].…”

“…Zeng et al (2022) [6] used a spatial econometric approach to show that these regulations significantly impact the hog industry in highly regulated areas. These studies evaluating hog-relocation policies and regulations have consistently shown that such regulations lead to reduced animal numbers rather than the relocation of production capacity [5,6]. Despite these efforts, there is a notable gap in the comprehensive analysis of how campaign-style enforcement strategies have impacted the creation of wider NLPRs at the local level and the specific mechanisms through which these measures have resulted in reduced hog production in China.…”

“…Our article delves deep into the impact of campaignstyle regulation on hog production, offering a fresh perspective on an understudied subject. First and foremost, this paper contributes to understanding how campaign-style regulation impacts the hog production industry [5,6]. We serve as an illuminating exploration of the intricate ways in which campaignstyle regulation exerts influence on the hog production industry, shedding light on the often-overlooked complexities, consequences, and implications of this regulatory approach.…”

The unintended impact of environmental regulation on China’s hog sector

“…Existing studies have shown that environmental regulations hurt hog production because they reduce the number of hogs slaughtered, the inventory of live hogs, and pork production by 8.3%, 10.3%, and 11.2%, respectively (Chen et al, 2021). Zeng et al (2022) use a spatial econometric approach and national prefecture-level hog inventory data to show that environmental regulation policies signi cantly reduce the output of the hog industry in highly regulated areas. Some studies offer a systematic evaluation of the effectiveness of the hog-relocation policies and regulations in curbing production and improving water quality ( Chen et al, 2021;Cheng et al, 2022).…”