How Pollution Charges Affect the Enterprise Productivity? Evidence from the Chinese Manufacturing Industry

Xu Baochang, Xie Jianguo

The Journal of World Economy ›› 2016, Vol. 39 ›› Issue (8) : 143-168.

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The Journal of World Economy ›› 2016, Vol. 39 ›› Issue (8) : 143-168.

How Pollution Charges Affect the Enterprise Productivity? Evidence from the Chinese Manufacturing Industry

  • Xu Baochang1,2, Xie Jianguo2
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Abstract

This paper establishes a theoretical model to analyze the influence mechanism of pollution charges on the enterprise productive efficiency, and further empirically tests this model by the Chinese manufacturing firm-level data.Our study shows that the effect of the pollution charges on enterprise productive efficiency is nonlinear.Specifically, pollution charges in a low strength have a hinder effect, while pollution charges beyond a certain collection strength, however, have a promotion effect.Our results prove that pollution charges and enterprise productive efficiency improvement are not entirely conflicting, where the key is to choose a reasonable strength of pollution charges to balance the above two appropriately.

Key words

pollution charges / productive efficiency / Chinese manufacturing industry

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Xu Baochang, Xie Jianguo. How Pollution Charges Affect the Enterprise Productivity? Evidence from the Chinese Manufacturing Industry[J]. The Journal of World Economy, 2016, 39(8): 143-168

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