A Theory Model and Empirical Validation in Relation to the Influence that Industrial Transfer may Have on Local Environment Regulation——Based on Empirical Tests of China's Industrial Transfer

Abstract

Abstract:

First, a perfect information dynamic game that involves local manufacturers, foreign manufacturers, local government and consumers is set up to study the effect of industrial transfer on local environment regulation, and then by solving the Nash equilibrium, we reach the conclusion that negative effect of industrial transfer on local environmental regulation depends on the corruptibility of local government, namely the more corrupted the local government is, the more negative effect that industrial transfer will have on local environment regulation. In empirical analysis, this paper adopts a province-level panel data model including data from 1992 to 2014 to test this conclusion, and the regression result proves to be consistent with the theoretical model. Therefore, when setting environment regulation policies or industrial transfer policies, the government should pay more attention to negative effects or adverse effects that industrial transfer may have on environment regulation, especially in highly corruptive regions.

Key words: industrial transfer, corruption, Nash equilibrium, pollution

Liu Manfeng, Li Xinyao. A Theory Model and Empirical Validation in Relation to the Influence that Industrial Transfer may Have on Local Environment Regulation——Based on Empirical Tests of China's Industrial Transfer[J]. , 2018, 30(8): 32-42.

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