How to promote the green development of the economy and society is the core issue of the current era. As a new policy concept, green industrial policy is of great significance to solve the bottleneck problem faced by China’s green development. In view of this, based on the perspective of industrial policy, this paper makes a thorough analysis of the theoretical mechanism of green industrial policy, and analyzes the problems existing in the green development of China’s industry and the corresponding policy practice. The study shows that: (1) Green industrial policy is the reform of traditional industrial policy, environmental policy and their relationship under the background of green development concept; its essence involves the profound reform of the economic model, technological conditions and institutional structure, in which the core lies in promoting sustainable technological breakthroughs, and the difficulty lies in coordinating different conflicts of interests and undertaking the risk of uncertain policy intervention. However, in the current understanding of green industrial policy, whether it is industrial policy focusing on economic benefits or environmental policy focusing on internalizing the external cost of the environment, its essence cannot cover the development of green industrial policy. (2) China’s green industrial policy is rooted in the practice of solving the problem of decoupling environmental externalities from economic development, and its policy focus is still on the combination of administrative compulsory means and traditional industrial policy, with insufficient attention paid to the role of the market mechanism and the coordination between policies. (3) The key to building and perfecting China’s green industrial policy system lies in promoting the coordination of industrial policy and the market mechanism, industrial policy and environmental policy, forming a new path of development in the combination with the market mechanism, paying attention to the coordination and complementarity of policy tools, and establishing an organizational mechanism to promote policy coordination. Specifically, it is necessary to give full play to the basic role of the market, promote the direction of social change and technological innovation to reach consensus among different interest groups, and evaluate and improve the supporting projects from the two dimensions of policy system coordination and institutional system purposefulness. This paper attempts to provide guidance for the construction of the green industry policy system in line with China’s national conditions and tries to provide a theoretical basis for the policy formulation to promote China’s green development.
Green Industrial Policy: Theory Evolution andChinese Practice
Journal of Finance and Economics Vol. 45, Issue 08, pp. 4 - 27 (2019) DOI:10.16538/j.cnki.jfe.2019.08.001
 Bao Q, Shao M, Yang D L. Environmental regulation, provincial legislation and pollution emission in China[J]. Economic Research Journal, 2013, (12): 42-54. (In Chinese)
 Chen L, Xie M X. CIDEG policy research report: Five reforms of China’s environmental governance system since the 18th National Congress[R]. 2018. (In Chinese)
 Chen S Y. Environmental issues and economic transformation under the new normal in China[J]. Journal of The Party School of The Central Committee of The C.P.C, 2016, (2): 94-99. (In Chinese)
 Duan M S. Coordination between China’s emissions trading system and policies of energy efficiency and renewable energy[J]. Journal of Environmental Economics, 2018, (2): 1-10. (In Chinese)
 Fan Q Q, Zhang T B. A study of environmental regulations and pollution abatement mechanism on China’s economic growth path[J]. The Journal of World Economy, 2018, (8): 171-192. (In Chinese)
 Jiang F T, Li X P. Direct market intervention and restrict competition: The orientation of China’s industrial policy and its fundamental defects[J]. China Industrial Economics, 2010, (9): 26-36. (In Chinese)
 Jiang F T, Li X P. On present transformation of China’s industrial policy[J]. Journal of Nanjing University (Philosophy, Humanities and Social Sciences), 2015, (3): 17-24. (In Chinese)
 Liu G Q. Analysis of the incentive effects of tax preferences and fiscal subsidies: An empirical study from the perspective of information asymmetry theory[J]. Management World, 2016, (10): 62-71. (In Chinese)
 Nie H H. The effective boundary and micro foundation of industrial policy[J]. Study & Exploration, 2017, (8): 110-117. (In Chinese)
 Peng H Z, Ren R M. Environmental policy instrument and business competitive advantage[J]. China Industrial Economics, 2003, (7): 75-82. (In Chinese)
 Shi D. The green development and the new stage of industrialization: Progress in China and comparison with others[J]. China Industrial Economics, 2018, (10): 5-18. (In Chinese)
 Shi D. Research on industrial policy of low-carbon development in China[M]. Beijing: People’s Press, 2017. (In Chinese)
 Zhang J, Chen Z Y, Yang L X, Xin F. On evaluating China’s innovation subsidy policy: Theory and evidence[J]. Economic Research Journal, 2015, (10): 4-17. (In Chinese)
 Zhang H M. Research on the causes and countermeasures of the overcapacity crisis in China’s new energy vehicle industry[J]. Scientific Management Research, 2018, (3): 28-35. (In Chinese)
 Altenburg T, Lütkenhorst W. Industrial policy in developing countries: Failing markets, weak states[M]. Cheltenham: Edward Elgar Publishing, 2015.
 Altenburg T, Rodrik D. Green industrial policy: Accelerating structural change towards wealthy green economies[A]. Altenburg T, Assmann C. Green industrial policy: Concept, policies, country experiences[C]. Geneva, Bonn: UN Environment & German Development Institute, 2017.
 Antonioli D, Borghesi S, D’Amato A, et al. Analysing the interactions of energy and climate policies in a broad policy ‘optimality’ framework: The Italian case study[J]. Journal of Integrative Environmental Sciences, 2014, 11(3-4): 205-224.
 Altenburg T, Pegels A. Sustainability-oriented innovation systems: Managing the green transformation[J]. Innovation and development, 2012, 2(1): 5-22.
 Borrás S, Edquist C. The choice of innovation policy instruments[J]. Technological Forecasting & Social Change, 2013, 80(8): 1513-1522.
 Christainsen G B, Haveman R H. The contribution of environmental regulations to the slowdown in productivity growth[J]. Journal of Environmental Economics & Management, 1981, 8(4): 381-390.
 Costantini V, Crespi F. Public policies for a sustainable energy sector: regulation, diversity and fostering of innovation[J]. Journal of Evolutionary Economics, 2013, 23(2): 401-429.
 Crespi F, Ghisetti C, Quatraro F. Taxonomy of implemented policy instruments to foster the production of green technologies and improve environmental and economic performance[R]. WWWforEurope Working Papers No.90, 2015.
 Daly H, Cobb J. For the common good [M]. Boston: Beacon, 1989.
 De Serres A, Murtin F, Nicoletti G. A framework for assessing green growth policies[J]. OECD Economics Department Working Papers No.774, Organization for Economic Cooperation and Development, 2010.
 DRC. Industrial upgrading for green growth in China: Thematic focus on environment[R]. Development Research Centre of the State Council of China, 2017.
 Fay M, Hallegatte S, Vogt-Schilb A, et al. Decarbonizing development: Three steps to a zero-carbon future[M]. Washington: World Bank Publications, 2015.
 Galinato G I, Yoder J K. An integrated tax -subsidy policy for carbon emission reduction [J]. Resource and Energy Economics, 2010, 32(3): 310-326.
 Gray W B. The cost of regulation: OSHA, EPA and the productivity slowdown[J]. The American Economic Review, 1987, 77(5): 998-1006.
 Hallegatte S, Fay M, Vogt-Schilb A. Green industrial policies: When and how[R]. World Bank Policy Research Working Paper WPS6677, 2013.
 Hausmann R, Rodrik D. Economic development as self-discovery[J]. Journal of Development Economics, 2003, 72(2): 603-633.
 IPCC. Climate change 2014: Mitigation of climate change. Contribution of working group III to the fifth assessment report of the intergovernmental panel on climate change[M]. Cambridge: Cambridge University Press, 2014.
 Jaffe A B, Palmer K. Environmental regulation and innovation: A panel data study[J]. Review of Economics & Statistics, 1997, 79(4): 610-619.
 Karp L S, Stevenson M T. Green industrial policy: Trade and theory[R]. World Bank Policy Research Working Paper No.6238, 2012.
 Krueger A O. The political economy of the rent-seeking society[J]. American Economic Review, 1974, 64(3): 291-303.
 Laffont J J, Tirole J. The politics of government decision-making: A theory of regulatory capture[J]. The Quarterly Journal of Economics, 1991, 106(4): 1089-1127.
 Lütkenhorst W, Altenburg T, Pegels A, et al. Green industrial policy: Managing transformation under uncertainty[R]. Deutsches Institut für Entwicklungspolitik Discussion Paper, 2014.
 Mazzucato M. The entrepreneurial state: Debunking public vs. private sector myths[M]. London: Anthem Press, 2015.
 Marechal K, Lazaric N. Overcoming inertia: Insights from evolutionary economics into improved energy and climate policies[J]. Climate Policy, 2010, 10(1): 103-119.
 Nordhaus W, Tobin J. Is growth obsolete?[M]. New York: Columbia University Press for NBER, 1972.
 Pigou A C. The economics of welfare [M]. London: MacMillan and Co., 1920.
 Porter M E, Linde C V D. Toward a new conception of the environment-competitiveness relationship[J]. Journal of Economic Perspectives, 1995, 9(4): 97-118.
 Rockström J, Steffen W, Noone K, et al. A safe operating space for humanity[J]. Nature, 2009, 461(7263): 472-475.
 Rodrik D. Green industrial policy[J]. Oxford Review of Economic Policy, 2014, 30(3): 469-491.
 Ruttan V W. Induced innovation, evolutionary theory and path dependence: sources of technical change[J]. The Economic Journal, 1997, 107(444): 1520-1529.
 Schwarzer J. Industrial policy for a green economy[M]. Canada: International Institute for Sustainable Development, 2013.
 Sunstein C, Reisch L. Automatically green: Behavioral economics and environmental protection[J]. Harvard Environmental Law Review, 2014, 38(1): 127-158.
 Schwab K, Sala-i-Martín X. The global competitiveness report 2013-2014[R]. World Economic Forum, 2013.
 Wiedmann T O, Schandl H, Lenzen M, et al. The material footprint of nations[J]. Proceedings of the National Academy of Sciences, 2015, 112(20): 6271-6276.
 Yülek M. Industrial policy and sustainable growth[M]. Berlin: Springer, 2019.
 Zhang P, Yang Y, Shi J, et al. Opportunities and challenges for renewable energy policy in China[J]. Renewable & Sustainable Energy Reviews, 2009, 13(2): 439-449.
Cite this article
Li Xiaoping, Zhang Yijun, Jiang Feitao. Green Industrial Policy: Theory Evolution andChinese Practice[J]. Journal of Finance and Economics, 2019, 45(8): 4-27.
Previous: The Spatial Linkage Mechanism of Medical System，Public Health Safety and Economic Prosperity