IMPACTS OF MANUFACTURING AGGLOMERATION ON CHINA’S GREEN TOTAL FACTOR PRODUCTIVITY BASED ON ADJUSTMENT OF ENVIRONMENTAL REGULATIONS
To achieve sustainability of China’s manufacturing and to increase economic growth quality, this paper studies the impacts of manufacturing agglomeration on China’s green total factor productivity, and discusses the effects of different environmental regulations during the process. Based on the panel data of China’s 30 provinces from 2005 to 2018, this paper uses ultra-efficiency SBM model, which is non-desired output, non-directional and non-angular, to measure their green total factor productivity, and applies Tobit regression model to analyze the impacts of manufacturing on China’s green total factor productivity, and to verify the adjustment of market-stimulating, command controlling and public-involved environmental regulations between manufacturing agglomeration and China’s green total factor productivity. Manufacturing agglomeration is outstandingly negative to China’s green total factor productivity above 1%, suggesting China’s manufacturing still in a highly polluting and energy-consuming model. Crowding effect of industrial agglomeration is larger than economic scale effect, adversely affecting green total factor productivity. Among different environmental regulations, command-controlling and public-involving are conspicuously positive to manufacturing agglomeration above 1%, suggesting both largely constrain the adverse impacts of manufacturing agglomeration on green total factor productivity, while market-stimulating environmental regulation is negative and fails the significance test, meaning it has no adjustment function. China’s manufacturing layout needs further improvement and its industrial structure needs to be adjusted to promote a green transformation of China’s economy. Government shall optimize environmental laws and regulations to fulfill their driving roles in green development.
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