Study On The Effects Of Environmental Regulation On Industrial Agglomeration

In 1990 s,heavy industry was developed in China in order to increase the economic benefits.Secondary industry became the pillar of national economy,which aided China's rapid economic development.However,with the development of the economy,the environment pollution got worse.To prevent and control pollution,environmental regulation policy has been issued in succession.Industrial agglomeration affected economic growth,whether environmental regulation promoted industrial agglomeration,then influenced economic development,has to be an essential problem for the sustainable development.Based on this,by studying the environmental regulation influence on the secondary industry and tertiary industry agglomeration,and then provide effective policy proposals for economic development.This paper comprehensively expounds the articles about the environmental regulation ?the heterogeneity of human capital and the industrial agglomeration,to understand the present research situation.For theoretical model,this paper introduces environmental regulation in the human capital model of Lucas,to prove the effects of human capital on environmental regulation,and studies the role of environmental regulation on industrial agglomeration according to the function of corporate profits.For empirical part,adopting the data from 30 provinces and municipalities and autonomous regions in China during 2004 to 2014,using the panel data of threshold effect model,defining the heterogeneity of human capital as the threshold variable,environmental regulation as a core variable,the size of the market,foreign direct investment,R&D and transportation costs as control variable,Using comparative study methods to research the heterogeneity of human capital in different threshold value,environmental regulation effect on the second industry and tertiary industry agglomeration.The study showed that the environmental regulation has the double threshold effects on industry agglomeration.When the human capital stays in a lower level,environmental regulation has a significant negative effect on secondary and tertiary industry agglomeration;when the human capital stays highly;environmental regulation has a significant positive effect on the second and the tertiary industry.The size of the market,foreign direct investment,R&D investment and transportation costs also play a positive role in promoting industrial.Therefore,the environmental management and cultivation of the talent are important factors of promoting economic development during China's transition period.