An Empirical Study On The Impact Of Environmental Regulation On The Industrial Performance In China

With serious environmental problems, environmental regulation has become the important measures to control environmental pollution around the world. But at the same time the strict environmental regulation can also restrict for economic development, industry performance and industrial international competitiveness and so on. Therefore, many scholars carried on a great deal of theoretical research and empirical analysis on environmental regulation on influence the economic development and the industrial performance and so on. The influence of environmental regulation on industrial performance mainly through the enterprise production cost, technology innovation and enterprise to enter, such as environmental regulation policy not only change the cost of production, can also affect the enterprise’s technological innovation behavior and the barriers size of the industry enterprise to enter the industry. The effective environmental regulation policy should be achieve targets to reduce pollution and to minimize the adverse impact on economic development and industrial performance. So the ultimate goal should be the "win-win" of economic development and environmental protection. As a developing country, China is facing the multiple weighing of economic development and environmental protection, industrial pollution control and industrial performance increase. But the research is lack, it is only confined to a particular industry or area. The research mainly prove the relationship between environmental regulation and industrial performance by the limited data. The conclusion is also different. So in this paper, it based on the mechanism of the effects of environmental regulation on industrial performance. Selecting the industrial sector as the empirical analysis of the sample, from the industrial sector, features three regions, different pollution industry and regulatory tools four perspective. Analyzing the impact of environmental regulation to industrial performance of industry. Understanding the differences of environmental regulation to impact economic development and industrial performance when reducing environmental pollution. To provide theoretical basis for improving the environmental regulation quality and level.In this paper, joining the system factors to the Structure-Conduct-Performance(SCP) to generate the S-SCP analysis paradigm. Environmental regulation policy will produce what kind of impact to the market structure and market behavior. At first, analyzed the impact of environmental regulation on industrial performance of direct effect and indirect effect. And made the empirical analysis to the different conclusions about the impact of environmental regulation on industrial performance by choosing four research view. Environmental regulation on industrial performance is difference not only because of industry difference, regional difference and different, but also because industry pollution degree of difference and different regulation tools. So the impact of environmental regulation on industrial performance is through the enterprise to enter, the industrial technology innovation, the direct and indirect factors such as total factor productivity. It has both positive and negative effect. Making correct explanation on the relationship between them only through the divisions’ points in comprehensive consideration of various factors. The conclusion also has maneuverability and practicability.In this paper, we use panel data model and data analysis methods such as DEA and so on. Selecting industrial industry during the years 2005-2013 of provincial scale above industry data and environmental data. Building environmental regulation and industrial performance between linear and nonlinear model. Making the exploration and argument of environmental regulation on industrial performance influence. The conclusion is as follows:(1) It has a positive role to the industrial industry in China. Although the environmental regulation is the obstacles of industrial enterprises in China, but it has the positive influence to total assets of the industry technology innovation, industry contribution rate and the overall Labor Productivity. Therefore, in general, the average impact is positive effect.(2) It has the negative effects in eastern region of China. It has played a positive role in promoting enterprise technology innovation and total factor productivity in central and western regions. This will be central role in promoting greater than in the western region.(3) It is conducive to improve the industry performance of the high levels of pollution and moderate pollution. But it is indifference to the light pollution industry. The biggest impact on heavy pollution industry, especially in terms of technological innovation. It will be conducive to the technological innovation by changes in environmental regulation intensity of heavy pollution industry. It also will achieve the purpose of environmental pollution control.(4) The command control tool is still the main tool that influences the performance of industrial industry in China. The eastern region is mainly composed of type market incentives, it is a positive role in the improvement of the industrial performance. But there are the command control type in the central and western regions. It has a positive role in promoting industrial technology innovation, but not obvious effect on technological progress.(5)The public participated tools has a significant effect on industry performance in China and all areas. Its promoting effect on industry performance has appeared in the eastern region, but still hinder the role for the Midwest. But the public participation will be one of the important regulation tools in the future with the development of network communication technology due to its lower cost and higher transparency.According to the above research conclusion, in order to improve the quality and level of Chinese environmental regulation and to achieve "win-win" of economic development and environmental protection. The paper put forward the feasible policy suggestions from the regional, industry pollution, tool difference aspects and so on. Then put forward the opinions to the marketization of Chinese environmental regulation. Especially the public participated tools, there is still no attention, but its role cannot be ignored. It can make a “reversed transmission mechanism” to control effectively the environmental pollution.It will not only strength the supervision of environmental pollution control, but also improve environmental regulation quality and level. Due to the limited data and time, the paper is not fully discussing the influence of environmental regulation on industrial performance, microscopic mechanism, especially from the perspective of game theory to understand business and government in the environmental regulation game strategy and decision-making behavior. It will be studied in the future.