The Relationship between Industrial Ownership and Environmental Pollution: Panel Data Evidence from China 2000-2010

Sammanfattning: This paper empirically investigates the relationship between industrial ownership and environmental degradation in the People’s Republic of China, with specific focus on two environmental indicators: volume of SO2 emissions and volume of industrial wastewater deemed unsafe for discharge. Sulfur dioxide and untreated wastewater emissions are considered some of the most problematic environmental and societal threats in China, generating concern both internationally and nationally. Identifying whether enterprise ownership is correlated with the existing volumes of these pollutants is important from a policy and regulation perspective. The sample of 286 observations has been collected from various editions of Provincial Statistical Yearbooks (available online at the Chinese Statistical Database), constituting to a panel dataset of 26 administrative regions spanning the years 2000-2010. A two-way fixed effects approach is used to conduct the empirical analysis. The main findings indicate that a higher public sector share, and thus a smaller private sector share, are positively correlated with SO2 emissions but negatively associated with toxic wastewater emissions. This implies that private sector enterprises may have better environmental performance that state-owned enterprises in China in terms of SO2 emissions, but worse environmental performance in terms of toxic wastewater discharge.