Positive Research On Environmental Protection Investment And Regional Economic Growth Relationship

The beginning of this paper points out the fundamental difference between two groups of scholar who were separated by their attitude, pessimism or optimism, about economic growth impacts on the environment quality, is because of confusion "economic growth limits" and "environmental carrying capacity" concepts, through literature review. The former as economic concepts, such as mainstream economics growth models suggest is that there is no limit; however the latter as environmental science concepts, such as environmental scientists have pointed out there exist a limit. So the environment must be protected and governance. Existing research makes people believe deeply that "environmental protection will hinder economic growth". However, one consequence of this law is in some regions, in order to achieve economic growth, have paid enormous environmental costs. The other is that theoretical studies tend to produce, say "development first" and "technology omnipotent" naive conclusions. It should not draw a metaphysics conclusion such as "environment protection will hinder economic growth" or "environmental protection will stimulate economic growth" just from one discipline view; on the contrary, an integration of various disciplines view should be used to consider the sustained economic growth and environmental quality change issue.Therefore, the author based on the neo-classical growth model, starts from environmental carrying capacity concept and combined with emergy analysis theory, had built a two-stage relation model of environmental protection investment and economic growth, which get the following main conclusions:First of all, the relationship between environmental protection investment and regional economic growth can be divided into two phase, early hinder and then prompt. If in the first phase, from a purely economics view, environmental protection investment can be reduced, but if taking into account the environmental carrying capacity, even if in this stage proper environmental protection investment are necessary. This is because the environment is not reversible and dynamic changes of environmental carrying capacity. If in the second phase, from any point of view, environmental protection investment is required. And different level of regional development has different environmental protection investment size. It needs regional data and econometric methods to determine how much investment is the best. Secondly, environmental protection investment promotes economic growth through two channels at the same time:the first one is similar to the direct investment affects economic growth, which can be roughly divided into three kinds of effects-reduced economies scale, optimize structural effects and improve the technical effects; the second one is through enhancing local environmental carrying capacity, thereby affecting economic factors of production inputs, human capital, productivity, fiscal policy, international trade to ensure sustainable growth. This paper will focus on the second channel. In addition, when environmental carrying capacity working there is a potential "time effect" exists, which play its role through gaining time for other channels running.Then using China's 30 provinces in the past five year panel data to study the relationship between environmental protection investment and regional economic growth. The empirical study found:first, at present, China has stay in the second phase, thus environmental protection investment will promoting economic growth; second, only 26.67% of the 30 provinces compensate for the regional environmental carrying capacity effectively when they get growth; third, the environmental carrying capacity improvement can not only direct affects economic growth variables, but can also make the pure economic growth mechanism run better then before, so as to continuously enhance the steady-state path of economic growth rate; fourth, use input & output elasticity to measure the "environmental protection investment contribution degree to economic growth" of the 30 provinces found it range from -2.60% to 5.67%.