The Impact of Strengthening Environmental Regulatory Policy on China's Economy——Evaluation Based on CGE Model

This paper has established a computable general equilibrium(CGE) model taking into account the costs of environmental regulation to evaluate the overall impact of enhanced environmental regulation on China's economy.The results demonstrate that if environmental regulation is strengthened to the point at which industrial waste discharge meets the current legal standard,economic growth rate will decrease by approximately1%,employment in the manufacturing sector will decrease by approximately 1.8%,and the total value of exports will decrease by approximately 1.7%.The report also shows that enhanced environmental regulation has impacted each region of China differently.This paper argues that during the implementation of environmental regulation,policymakers will need to have a complete understanding of potential regional and structural impacts.China's environmental regulation policy should be implemented gradually,beginning with key polluting industries and those with low correlation to economic growth.Additionally,this paper proposes that environmental regulation should be carried out during periods of economic growth.

A Non-Parameter Decomposition Framework that Better Estimates Contributors to China＇s Economic Growth （1978-2010）

This paper has deduced a non-parameter analysis framework that can estimate the sources of economic growth based on provincial data as samples. Result of the estimate indicates that between 1978 and 2010, TFP, labor and capital contributed to China＇s economic growth by 10.9%, 3.7% and 85.4% respectively. If the impact of global financial crisis is not taken into account, these figures should be 20.70/0, 3.3% and 76.0%. Contribution of labor to economic growth is the smallest, below 8%for most of the years. Share of TFP contribution increased before the 1990s despite wild swings, exceeding 50% in 1992, followed by continuous decline until well below 10% after 2005. Share of capital contribution decreased before 1990s with wild swings and maintained an upward trend after 1992, approaching 90% after 2005.

Decomposition of China＇s Industrial Environmental Total Factor Productivity Sources： Analysis Based on Factor Input and Pollution Treatment

Following slack-based inefficiency measurement method and Luenberger productivity index, this paper decomposes industrial environmental TFP index by input factors and output to estimate the sources of China＇s industrial environmental TFP. Results indicate that （1） China＇s industrial environmental TFP increased between 2001 and 2007 but declined in 2008 under the effect of global financial crisis; （2） input utilization productivity contributes 1/3 to industrial environmental TFP and pollution treatment productivity contributes about 2/3, which means that pollution treatment will effectively increase industrial environmental TFP; （3） capital utilization productivity contributes I/6 to input productivity and labor utilization productivity contributes about 5/6, which means that progress of labor production technologies is an effective means to increase industrial environmental TFP; （4） COD treatment productivity contributes roughly 2/3 to pollution treatment productivity, and S02 treatment productivity contributes about 1/3, which shows that priority on COD treatment will more effectively increase industrial environmental TFP.