Basin Horizontal Ecological Protection Compensation and Common Prosperity

Zhang Bingbing, Wang Yuan, Shen Guangjun

The Journal of World Economy ›› 2024, Vol. 47 ›› Issue (4) : 129-153.

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The Journal of World Economy ›› 2024, Vol. 47 ›› Issue (4) : 129-153.

Basin Horizontal Ecological Protection Compensation and Common Prosperity

  • Zhang Bingbing, Wang Yuan, Shen Guangjun
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Abstract

The paper takes the implementation of the cross-provincial Basin Horizontal Ecological Protection Compensation policy as a quasi-natural experiment and uses econometric analysis to investigate the effect and mechanisms of the policy on the common prosperity of basins based on multi-source data. The findings suggest that the policy can significantly bridge the wealth gap between the residents of the upstream and downstream counties. The mechanism analysis demonstrates that the policy can eventually increase the wealth among residents in compensated areas through the direct channel of increased transfer income and the indirect channel of increased wage income, thereby narrowing the wealth gap between the upstream and downstream counties. On the other hand, the policy can reduce the income gap within villages in compensated areas and effectively improve the village public services. The conclusion of the study provides a new perspective on building a multi-stakeholder ecological and environmental governance system and realizing China’s path to modernization with harmonious coexistence between humans and nature.

Key words

Basin Horizontal Ecological Compensation / common prosperity / regional disparities

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Zhang Bingbing, Wang Yuan, Shen Guangjun. Basin Horizontal Ecological Protection Compensation and Common Prosperity[J]. The Journal of World Economy, 2024, 47(4): 129-153

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