Impact of Environmental Regulation on High-Quality Economic Development

Abstract

Based on the connotation of high-quality economic development (HQED) in China, this study uses panel data of 30 provinces (cities and regions) in China from 2005 to 2019 to construct an evaluation index system of HQED with three dimensions of “economic development—social life—ecological environment,” and establishes a fuzzy comprehensive evaluation model to calculate the HQED index. The results show that the high-quality development level of China’s economy shows an upward trend of fluctuation, but the development level is still low and there are obvious regional differences. The eastern region enjoys the highest level of HQED, followed by the central region and western region. The panel data regression model is further established to analyze the impact of environmental regulation on economic development. It is found that there is an inverted u-shaped relationship between environmental regulation and HQED, and there is a “cost compliance” effect between environmental regulation and quantitative economic development. Strict environmental regulation measures will inhibit economic quantity growth. The results of heterogeneity analysis show that environmental regulation has different impacts on the economic development of the three regions due to the differences in resource endowment. The influence of environmental regulation on economic development in eastern China is similar to that in the whole country. However, in the central region, there is an “innovation compensation” effect between environmental regulation and HQED, and a “U” shape relationship between environmental regulation and quantitative economic development. In western China, the enhancement of environmental regulation will inhibit high-quality and quantitative economic development.

Green merger and acquisition decision driven by environmental regulation and its impact on green innovation: evidence from Chinese heavily polluting listed enterprises

“…And systematic environmental regulation (ER) will surely become the core tool to achieve the targets (Lyu et al, 2020 ). ER tools in China have long been dominated by command-and-control environmental regulation (CMCER), which is effective (Wang & Liu, 2022 ; Zeng et al, 2022 ) but may lead to negative economic and social effects (e.g., inhibiting the foreign direct investment (Chen et al, 2022 ), industrial growth (Liu et al, 2021 ), and economic quantity growth (Ma & Xu, 2022 )). In order to direct enterprises to protect the environment, China has been advocating implementing market-based environmental regulation (MBER) in the past few years (Ren et al, 2020 ; Song & Han, 2022 ).…”

Research on the effect of green credit on ecological welfare performance: Evidence from China

“…For instance, some studies have found that environmental regulation policies may greatly promote the level of green and high-quality economic development (Chen et al, 2020). Some papers suggest that environmental regulation has a nonlinear influence on green innovation (Liu et al, 2022) and the development of green economy (Shuai and Fan, 2020;Wang, 2020;Ma and Xu, 2022). And some scholars pointed out that the implementation of environmental regulations will bring spatial spillover effects to high-quality economic development in adjacent areas (Feng and Chen, 2018).…”

Coupling coordination and spatial-temporal characteristics of resource and environmental carrying capacity and high-quality development

“…Yang et al (2019) discussed the role of the government in high-quality innovation development, and pointed out that government governance needs to be adapted to local conditions. In the case of environmental governance, the impact of environmental regulations varies for different regions (Ma and Xu, 2022). Appropriate environmental regulations can promote high-quality and sustainable economic development (L. Chen et al, 2022a), but overly stringent regulatory measures can be counterproductive (Yang et al, 2022).…”