Threshold Effect in the Relationship between Environmental Regulations and Haze Pollution: Empirical Evidence from PSTR Estimation

Yonglian Chang, Yingjun Huang, Manman Li and Zhengmin Duan
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Yonglian Chang: School of Economics and Business Administration, Chongqing University, Chongqing 400030, China
Yingjun Huang: School of Economics and Business Administration, Chongqing University, Chongqing 400030, China
Manman Li: Department of Statistics and Actuarial Science, College of Mathematics and Statistics, Chongqing University, Chongqing 400030, China
Zhengmin Duan: Department of Statistics and Actuarial Science, College of Mathematics and Statistics, Chongqing University, Chongqing 400030, China

IJERPH, 2021, vol. 18, issue 23, 1-19

Abstract: The impact of environmental regulations (ER) on haze pollution control has been continuously debated in the field of sustainable development. This paper explores the direct and indirect threshold effects of ER on haze pollution, and five underlying mechanisms—technological innovation (TI), industrial structure (IS), foreign direct investment (FDI), urbanization (UR), and electricity consumption (EC)—are adopted to investigate the indirect threshold effects. Panel data, over the period 2008–2018, of 284 Chinese cities were used and the threshold effects were predicted endogenously based on the panel smooth transition regression (PSTR) model. The results showed the following: (1) For the direct threshold effect, there exists a U-shaped relationship between ER and haze pollution. ER significantly reduced haze pollution when ER < 38.86 due to “cost effects”. However, ER increased haze pollution after the threshold owing to the “green paradox”, which was not significant. (2) For the indirect threshold effect, when TI = 0.37, IS = 39.61, FDI = 7.25, and UR = 42.86, the relationships between ER and haze pollution changed. The changes and corresponding reasons for the indirect threshold effects are discussed in detail. (3) After a comprehensive analysis, the threshold effects have obvious regional distribution characteristics and internal connections. Finally, based on the results, it is essential for governments to enact appropriate environmental regulatory policies and enhance inter-regional synergies in environmental governance.

Keywords: direct threshold effect; indirect threshold effect; environmental regulation; non-linear; haze pollution; PSTR (search for similar items in EconPapers)
JEL-codes: I I1 I3 Q Q5 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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