Environmental Federalism: Chinese Governmental Behaviors in Pollution Regulations

dc.contributor.advisorLichtenberg, Eriken_US
dc.contributor.authorYan, Youpeien_US
dc.contributor.departmentAgricultural and Resource Economicsen_US
dc.contributor.publisherDigital Repository at the University of Marylanden_US
dc.contributor.publisherUniversity of Maryland (College Park, Md.)en_US
dc.description.abstractChina's economic growth has come with the cost of environmental deterioration. The economy has faced with many problems in land resource depletion and industrial pollution. I examine two policies that tackle three major environmental aspects on land, water, and air in China. All three chapters share the theme that devolution without enough oversights in environmental policies has lead to unintended consequences in practice, as local officials have their trade-offs to promote local economy and protect environment. The first chapter explores the local government's behavior in a land conservation program, which intends to reduce soil erosion by subsidizing afforestation of low productive farmland on steep slopes. Theoretically, the incentives created by the program combined with insufficient oversight have led to afforestation of highly productive farmland on level ground. With a unique land transition dataset, I show that this unintended land use effect has been substantial. This unexpected displacement of highly productive farmland represents a form of leakage that has not been fully explored in the literature. And it is problematic to a country with limited arable land relative to population size as it can negatively impact national food production targets and self-sufficiency goals. The second chapter investigates water pollution activities under China's Pollution Reduction Mandates. In response to the substantial environmental deterioration, the central government taxes firm emissions and subsidizes abatement technology installation. In theory, devolution to local governments to lower pollution and promote economic growth can create local incentives to allocate subsidies to effectively export pollution. I provide the first evidence of the magnitude of these distortions with unique firm-level pollution panel data and find evidence of water pollution exported to downstream and further away from local residences. A simulation indicates that the distortions created by local jurisdictional control harm the environment substantially: centralized allocation of subsidies could reduce total emissions by 20-30%. The third chapter keeps investigating the inter-jurisdictional pollution externalities on air pollution under the same mandates. It provides a complimentary evidence to show that local governments have incentives to promote spatial spillovers and free-ride on the downwind neighbors.en_US
dc.subject.pqcontrolledEnvironmental economicsen_US
dc.subject.pqcontrolledAgriculture economicsen_US
dc.subject.pqcontrolledPublic policyen_US
dc.subject.pquncontrolledAir Qualityen_US
dc.subject.pquncontrolledEnvironmental Serviceen_US
dc.subject.pquncontrolledLand Useen_US
dc.subject.pquncontrolledPollution Regulationen_US
dc.subject.pquncontrolledWater Qualityen_US
dc.titleEnvironmental Federalism: Chinese Governmental Behaviors in Pollution Regulationsen_US


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