Water Resource Tax and Green Industrial Development: Reform from the Largest Emerging Economy

Haiyan Lu, Yongxin Zhu () and Yongqing Kang
Additional contact information
Haiyan Lu: School of Accountancy, Lanzhou University of Finance and Economics, Lanzhou 730020, China
Yongxin Zhu: School of Accountancy, Lanzhou University of Finance and Economics, Lanzhou 730020, China
Yongqing Kang: School of Accountancy, Lanzhou University of Finance and Economics, Lanzhou 730020, China

Sustainability, 2025, vol. 17, issue 10, 1-20

Abstract: The global challenge of water resource management presents a policy dilemma: while water resource tax aims to foster green development, it may hinder the economic potential of micro entities. This paper evaluates the efficacy of a trial of water resource tax reform in China regarding the green total factor productivity of listed Chinese industrial enterprises over the period spanning 2012–2019 by employing a quasi-natural experiment. This study utilizes multi-period Difference-in-Differences (DID) and propensity score matching methodologies to deal with the self-selection bias inherent in choosing pilot areas. The findings illustrate that the reform exerted a crucial beneficial impact on the GTFP of industrial enterprises. The main takeaway of this study is that the phased reform, integrating water resource taxes with the adaptation of micro entities, offers a pathway for economies to balance resource restrictions with sustainable development.

Keywords: water resource tax; industrial enterprises; propensity score matching; difference-in-differences (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2071-1050/17/10/4478/pdf (application/pdf)
https://www.mdpi.com/2071-1050/17/10/4478/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:17:y:2025:i:10:p:4478-:d:1655817

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().