Does industrial agglomeration promote high‐quality development of the Yellow River Basin in China? Empirical test from the moderating effect of environmental regulation

Siliang Guo and Heng Ma

Growth and Change, 2021, vol. 52, issue 4, 2040-2070

Abstract: How to realize the ecological protection and high‐quality development (HQD) of the Yellow River Basin (YRB) has become a great challenge for China. Based on panel data from 100 prefecture‐level cities in the YRB from 2006 to 2018, this innovative paper employs the System Generalized Method of Moments (SYS‐GMM) panel model and takes environmental regulation as a situational factor to empirically examine the influence mechanism of industrial agglomeration on HQD in the YRB. Our findings reveal that: (i) overall, a “U‐shaped” relationship exists between industrial agglomeration and HQD in the YRB, and environmental regulation plays a vital role in augmenting their relationship. (ii) Presently, the industrial agglomeration degree prevails on the left side of the threshold value, and the upsurge of industrial agglomeration degree still limits HQD. (iii) From the perspective of river basins, the influence of industrial agglomeration on HQD in the upstream is not significant, and the strengthening effect of environmental regulation is not noticeable. We find a “U‐shaped” relationship between industrial agglomeration and HQD in the midstream, along with notable differences in the correlation between industrial agglomeration and different dimensions of HQD in downstream. This paper helps in further understanding the influence of industrial agglomeration, environmental regulation, and HQD, as well as establishes efficient policies to promote HQD in the YRB and other similar river basins through industrial agglomeration in the context of environmental constraints.

Date: 2021
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