The disappearance of pollution havens under unified environmental regulation: evidence from China’s pig industry

ABSTRACT

Since 2014, China has implemented a unified environmental regulation policy for the livestock industry. With unified environmental regulations across provinces, does the phenomenon of ‘pollution havens’ still exist? To address this question, this paper examines spatial variations among provinces and their spillover effects on the pig industry using data on environmental regulations and pig production panels. The results indicate that: (1) Environmental regulation policies are gradually converging across regions. (2) Under unified environmental regulation, the existence of ‘pollution havens’ in the pig industry is no longer evident. As national regulations become stronger, increasing local regulatory intensity will not affect the number of pig farms in neighboring areas nor lead to significant emigration of such farms. (3) In cases where there are inter-regional variations in environmental regulations, large-scale farmers may relocate to neighboring areas with less stringent regulations; however, under unified environmental regulation, neither small nor large-scale farmers will migrate.

KEYWORDS:

• Unified environmental regulation
• pollution havens hypothesis
• pig industry
• spatial spillover effects

JEL CLASSIFICATION:

• Q56
• Q57
• R11

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1. https://www.gov.cn/xinwen/2020–06/10/content_5518391.htm.

2. Since 2018, the outbreak of African swine fever has emerged in China, exerting a profound impact on pig production, particularly in terms of pig population and industry layout. To overcome this confounding factor, this paper utilized China’s pig industry data from 2010 to 2017.

Additional information

Funding

The work was supported by the National Natural Science Foundation of China [72261147758; 71903121; 72073070].