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Is the environment a victim of the economic downturn? Evidence from China's manufacturing firms

Published online by Cambridge University Press:  16 August 2022

Xuemei Zhang ,
Haitao Yin Open the ORCID record for Haitao Yin [Opens in a new window]  and
Huimin Yang
Xuemei Zhang
Affiliation:
Antai College of Economics and Management, Shanghai Jiao Tong University, Shanghai, China
Haitao Yin*
Affiliation:
Antai College of Economics and Management, Shanghai Jiao Tong University, Shanghai, China Institute of Eco-Chongming, Chongming, Shanghai, China
Huimin Yang
Affiliation:
Antai College of Economics and Management, Shanghai Jiao Tong University, Shanghai, China
*
*Corresponding author. E-mail: htyin@sjtu.edu.cn
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Abstract

This paper investigates whether pollution-intensive industries develop faster in a time of economic downturn. Using firm-level panel data from 2005 to 2013, we find supporting empirical results in an analysis of China's manufacturing industries in the 2008 economic crisis. We find that pollution-intensive firms tended to produce more compared with non-pollution-intensive firms in the 2008 economic crisis, with the pre-crisis period as a baseline. We further find that this effect is more pronounced in areas with higher export dependence and a smaller proportion of production from pollution-intensive industries. The relatively faster production expansion in pollution-intensive industries is more evident for state-owned enterprises.

Keywords

Chinaeconomic downturneconomic growthenvironmental Kuznets curveenvironmental protection

JEL classification

Q56: Environment and Development • Environment and Trade • Sustainability • Environmental Accounts and Accounting • Environmental Equity • Population Growth R11: Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
Type
Research Article
Information
Environment and Development Economics , Volume 28 , Issue 2 , April 2023 , pp. 191 - 209
Copyright
Copyright © The Author(s), 2022. Published by Cambridge University Press

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