The Effect Of Environment Regulation On Export Product Quality

Since the execution of Revolution and Opening policy,Chinese oversea trade developed rapidly,however the growth rate is slowing down in recent years.The product quality has become a new way of promoting foreign trade.Besides,people is paying attention to the environmental pollution.Environmental rules and regulations require enterprises to comply with the Environmental Protection Code in production process.The sustainable development concept means promoting the foreign trade growth while protecting the environment,so it is meaningful to study the influence of environmental regulation on the quality of export products.Firstly,this paper introduces the background of slow growth in export trade and environmental pollution,making seeking for the quality and environmental regulation important.Secondly,the paper combs the literature,and reviews the definition,measure,trade theory and influencing factors of the export product quality and the environmental regulation.This paper mainly discusses and analyzes quality of the export products effected by environmental regulation under globalization of green development,and their relationship in different industry conditions.Thirdly,the paper puts forward the theory mechanism of environmental regulation on the quality of export products:firstly,the environmental regulation causes the increase of production cost,and the input of quality is compressed,which is not conducive to the improvement of product quality.Secondly,environmental regulation improves the price of factors,enhancing the quality of products,meanwhile stimulates the new products innovation and processes improvement,improving production efficiency and product quality.It needs discussion which effect is stronger and analysis according to the specific situation of our country.This paper holds that when environmental regulation is becoming stronger from weak,cost effect is more violent,and the effect of innovation is higher as environment regulation getting stricter.The reason is that when environmental regulation getting stronger from weak,the innovation motive of environmental regulation on research and development is small,the research process is long,the output ratio and the conversion rate are low,the regulation cost is high.With the continuous strengthening of environmental regulation,the innovation effect become obvious by the multiplier effect of technological innovation and the cost advantage.Fourthly,the paper chooses the data of export product quality and environment regulation in 19 Chinese industries from 2003 to 2010,establishing regression model for empirical test.Using the fixed effect model to test,the regression results show that the environmental regulation reduces the product quality at first,but when the environmental regulation reaches a certain level,it will improve the product quality.This is mainly because when the enterprises is facing strict environmental regulations,the cost is more,resulting in the increase in business costs and leading to a downward trend;however,with the constant strengthening of regulation,enterprises heavily assume regulatory pressure,and shift to innovative activities to enhance product technology,thus improves the quality of export products.Environmental regulation sensitivity differs in industries.Regression results show that in the mild pollution industry,the environmental regulation firstly have the promotion function on export product quality,then has the inhibition.This may be because for the lightly polluting industry,the mild environmental regulation can stimulate the enterprise to innovate to improve product quality,but excessively strict regulation will cause serious economic pressure.In severe pollution industry,environmental regulation firstly has limited effect,then the stimulation of the role of innovation greatly improves the quality of exports.Besides,the robustness of the model is validated by GLS estimation methods and lag-phase method.Finally,combined with theoretical and empirical results,some suggestions are put forward,one is to increase the investment of enterprise research and development so as to promote the innovation,speed up the progress of innovation and improve the quality of export product;the other is to adopt appropriate environmental regulation methods and set up different standards for different industries,so that environmental regulation becomes an effective tool for environmental and economic benefit.