The Chinese-style environmental federalism, embedded in the system of the Chinese-style decentralization, is the useful supplement and improvement for the classic environmental federalism theory. For the sake of answering the debate of centralization and decentralization of environmental protection, this paper focuses on carbon emission reduction affair and empirically tests the effect of environmental decentralization on carbon emissions by employing static, dynamic and dynamic spatial panel data models based on a consideration of potential endogeneity of decentralization indicators. Empirical results show that environmental decentralization has significantly positive effect on carbon emissions, suggesting that China's current environmental decentralization system is not conducive to carbon emission governance. Therefore, the conclusion provides evidence for the "vertical management" of the environmental protection system. Furthermore, it elaborates the internal logic of carbon emission reduction dilemma under the environmental decentralization system in the following three aspects:the evolution history of China's environmental management system, the inadequacies of incentives for local governments' environmental protection expenditures and the lack of independence of local environmental protection departments. Therefore, in order to construct a long-acting environmental management system for controlling carbon emissions, the Chinese-style environmental federalism needs to intensify its will of centralization so as to optimize the territorial management system and form a vertical management and incentive-compatible system.
Chinese-style Environmental Federalism:A Study on the Effect of Environmental Decentralization on Carbon Emissions
Journal of Finance and Economics Vol. 43, Issue 09, pp. 33 - 49 (2017) DOI:10.16538/j.cnki.jfe.2017.09.003
Cite this article
Zhang Hua, Feng Chao, Liu Guanchun. Chinese-style Environmental Federalism:A Study on the Effect of Environmental Decentralization on Carbon Emissions[J]. Journal of Finance and Economics, 2017, 43(9): 33–49.