Water diversion and agricultural production:Evidence from China

Water diversion can alleviate water shortages caused by the uneven distribution of water resources.China’s Southto-North Water Diversion Project(SNWD)is the largest water diversion project worldwide.Based on the prefecturelevel data of China’s Huang-Huai-Hai Plain from 2000 to 2020,this study employs an empirical strategy of Differencesin-Differences(DID)to analyze the impact of SNWD on agricultural production.The results show that SNWD has significantly increased agricultural production,measured by the agricultural value added.The estimated results of the benchmark model remain robust when the contemporaneous policy is addressed,an alternative outcome is used,subsamples are estimated,and alternative estimation techniques are employed.This study argues that the potential impact mechanism may be that SNWD significantly increases the acreage for cash crops but reduces that for grain crops.Heterogeneity analysis shows that in prefectures with high temperature or land potential,SNWD’s impact on agricultural value added is relatively low.In contrast,in areas with prolonged sunshine or high slopes,SNWD’s impact on agricultural value added is relatively large.Given the low added value of grain crops,the government should consider strengthening food security by subsidizing water supply to sustain grain production.

The impact of carbon emission trading policy on firms’green innovation in China

This study aims to examine the green innovation effect of the carbon emissions pilot policy in China.First,using the difference-in-differences method and regressions of instrumental variables using the data from Chinese listed firms,we verify that the policy promotes green innovation among regulated firms and is more pronounced among state-owned enterprises,firms in the eastern region,and those with lower financing constraints.Furthermore,this positive effect spreads downstream relative to the regulated firms through input–output linkages,but reduces green innovation to upstream firms.Accordingly,such diffusion of innovation is achieved through the price mechanism.The results necessitate the introduction of various derivatives to mobilize the market to reduce the speculative volatility of carbon prices.In addition,relevant supporting policies must be established to encourage corporate innovation to reduce the crowding-out effect owing to emission reduction and the nonmarket factors.

Can environmental regulations achieve both profitability and profit quality?A natural experiment based on the China Cleaner Production Standards

Numerous studies evaluated the effects of end-of-pipe control environmental regulations(EER).However,few scholars discussed the effects of process management environmental regulations(PER),such as the China Cleaner Production Standards(CCPS)implemented by the country's Ministry of Ecology and Environment.Using data on China's manufacturing enterprises,this paper adopts the CCPS policies as quasi-natural experiments and uses differences-in-differences(DID)methods to analyze their effects on enterprise profitability and profit quality,respectively.The results show that:first,the CCPS significantly improve both profitability and profit quality;that is,the implementation of the environmental regulation policy plays a significant role in improving enterprise profit rates and cash flows.Second,for the profitability mediator effects,the short-term Porter effect of CCPS is not significant but shows the opposite during the lag period and significantly reduces the management cost and wage levels,comprehensively promoting enterprise profitability.Third,for the profit quality meditator effects,environmental regulations improve the enterprises'cash flow by reducing management costs and increasing government subsidies;however,its effect on bank credit subsidies is not significant.Fourth,for the moderator effects,the environmental regulations'effect on enterprises profitability and profit quality depends on the strategic interaction among local governments,the scale and ownership of the enterprise,and regional differences.That is,the strategic interaction weakens the effect of environmental regulations on enterprise performance.Environmental regulations have a stronger influence on profitability and profit quality for large-scale,state-owned,and coastal enterprises.