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Import Liberalization of Intermediates and Environment: Empirical Evidence from Chinese Manufacturing

Ling-Yun He and Liang Wang ()
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Liang Wang: College of Economics, and Institute of Resource, Environment & Sustainable Development Research, Jinan University, Guangzhou 510632, China

Sustainability, 2019, vol. 11, issue 9, 1-15

Abstract: This paper investigates how the import liberalization of intermediates affects firm-level pollution emissions. We divide the impact of freer import of intermediates on pollution emissions into induced scale, composition and technique effects and then develop interaction terms to examine these effects. Relying on a panel of plant-level data from China manufacturing sector for the period 2001 to 2007, we find freer import of intermediate inputs is conducive to pollution reductions at the plant level, lowering pollution via induced technique and composition effects and, in turn, increasing emission through induced scale effect. In summary, import liberalization of intermediate inputs can contribute to the better environmental performance of China manufacturing sector.

Keywords: import liberalization; intermediate inputs; pollution emissions (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2019
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