Assessing the Impact of a Regional Integration Policy on Corporate Environmental Performance: Micro-Evidence from Chinese Industrial Firms

Xiang Zhang, Xuhui Long, Zongyi Zhang, Chenyang Yu and Rong Huang ()
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Xiang Zhang: Accounting School, Chongqing University of Technology, Chongqing 400054, China
Xuhui Long: Accounting School, Chongqing University of Technology, Chongqing 400054, China
Zongyi Zhang: School of Economics and Business Administration, Chongqing University, Chongqing 400030, China
Chenyang Yu: Academy of Guangzhou Development, Guangzhou University, Guangzhou 510006, China
Rong Huang: Accounting School, Chongqing University of Technology, Chongqing 400054, China

Sustainability, 2023, vol. 15, issue 16, 1-17

Abstract: Environmental performance is extremely vital for sustainable growth in China, and the impact of a regional integration policy plays an important role in improving environmental performance. However, current studies are weak in causal inference, and firm-level evidence is lacking. As a result, taking the Outline of the Pearl River Delta Reform and Development Plan as a quasi-natural experiment, with propensity score matching and difference-in-differences methods, this paper investigates the effect of regional integration on firms’ environmental performance. Our empirical results show that regional integration can significantly improve corporate environmental performance; specifically, the regional integration will result in an increase in the output value, of 46.7%, 22.3%, and 68.1% per unit emission of sulfur dioxide (SO 2 ), industrial wastewater (WATER), and industrial smoke and dust (SD). Moreover, the impact of regional integration differs across different industries. For SO 2 , the impact of regional integration is greater for the petroleum processing, coking and nuclear fuel processing industries, and special equipment manufacturing; in terms of WATER, the impact is much higher in the tobacco products industry and printing and the reproduction of recording media industry; for SD, the petroleum processing, coking, and nuclear fuel processing industries are highly impacted. Finally, this impact also differs for core and peripheral cities. For policy implications, first, regional integration policies are highly recommended, and China is implementing regional integration in the Beijing–Tianjin–Hebei area and Yangtze River Delta, and these policies should be enhanced for other areas. Second, to maximize the effect of regional integration, the government needs to combine regional industrial structural characteristics to formulate industrial and environmental policies.

Keywords: regional integration; corporate environmental performance; quasi-natural experiment (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
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