A Study On Impact Of Environmental Regulation On Industrial International Competitiveness Of China

The trend of globalization had led to continuing reduction of trade barriers, while the environmental regulation raised as a new trade barrier. The impact of environmental regulation on the industrial international competitiveness, which gradually became an important issue for the policy makers, was a controversial topic in the academia during recent years. Till now, no coincident conclusion had been reached for this topic. Theoretical analysis tended to internalize environmental costs and argue that strict environmental regulation would decrease international trade and weaken the competitiveness. However, empirical research had drawn different conclusions which supported both positive and negative effects. This issue was worthy of research for developing countries. If environmental regulations have negligible impact on the industrial international competitiveness, or even conducive to long-term industrial international competitiveness, then we should establish a more stringent environmental regulation policy, and actively participate in the international competition based on environment, and create a natural environment in harmony with society.This paper firstly reviewed the theory and empirical research concerned environmental regulation and industrial international competitiveness and summaried China's environmental regulation and industrial development. Then we analyzed the influence mechanism of environmental regulations on industrial international competitiveness in theory from the perspective of cost and non-cost and emphasised the beneficial effect of environmental regulation on industrial international competitiveness. And then we made the empirical research on the impact of environmental regulation on China's industrial international competitiveness. We put primary products and business services which other scholars neglected into the empirical research framework and creatively divided the industry sector into the high-tech and low-skilled industries by the OECD technology-intensive method. Based on theoretical and empirical research, generally speaking, we believed that the impact of environmental regulation on China's industrial international competitiveness wasn't significantly, but it was positive on technology-intensive industries. Finally, we gave the appropriate policy recommendations, based on the conclusions of the research in the paper..