Search Results (12)

With the advancement of economic globalization, market integration has become a critical contributing factor for sustainable economic development. However, the persistence of zombie firms continues to undermine fiscal sustainability, creating a critical policy challenge. The core purpose of this article is to propose novel policy directions for emerging economies to foster domestic market integration (DMI) and sustainable development. Based on panel data from 297 cities in China from 2008 to 2020, this paper employs a two-way fixed effects model to empirically test the impact of subsidies allocated to zombie firms on DMI. The results indicate that targeted subsidies provided by local governments to zombie firms exacerbate regional market segmentation and hinder the process of DMI. The analysis reveals several key mechanisms underlying this phenomenon: on the one hand, local governments may shift expenditure burdens to enterprises located outside their jurisdiction, leading to higher institutional trade costs and lower fiscal sustainability; on the other hand, the persistence of zombie firms crowds out the resources available to healthy enterprises and distorts the allocation of factor resources, thereby impeding the ability of local products to compete effectively in intercity markets. However, enhancing the business environment and upgrading the industrial structure can effectively mitigate the market fragmentation induced by such inefficient subsidies. This research offers a novel perspective for quantifying local protectionism and provides important implications to improve DMI as well as sustainable economic development. Full article

Cross-region and cross-industry cooperation has become a key driver of industrial transformation. Advanced manufacturing is boosting the modern service industry and fostering innovation and development, while the modern service industry is promoting advanced manufacturing and stimulating the market demand. The convergence of advanced manufacturing and modern services (CAMMS) is a key driver of environmental innovation in China’s modern economy. This study explores the impact of CAMMS on green innovation efficiency and its spatial correlations. Employing a two-way fixed-effect model, along with the mediating-effect model and the spatial Durbin model (SDM), we analyze Chinese provincial panel data from 2006 to 2021 to explore the effects of CAMMS on green innovation efficiency and its spatial spillover effects. Our findings reveal the following: (1) CAMMS significantly enhances green innovation efficiency. (2) Optimizing industrial structure and improving factor allocation are the primary mechanisms through which CAMMS promotes green innovation efficiency. (3) The CAMMS mechanism positively influences spatial spillover effects on green innovation efficiency, with these effects becoming more pronounced in the eastern region and after 2011. (4) Finally, due to increasing information transmission costs and local protectionism, the “spillover effect” of CAMMS on green innovation efficiency has geographical boundaries. This study contributes to the literature by providing valuable insights for future practices in CAMMS and green innovation strategies in China. This also provides strong support for the local economy to achieve green transformation and sustainable development. Full article

The spatial correlation of high-quality development has emerged as a crucial approach to tackling economic polarization. This study assesses the level of high-quality development in China from 2006 to 2020, utilizing the new development concept. Social network analysis is employed to explore the spatial correlation mechanism of high-quality development. The quadratic assignment procedure (QAP) is used to analyze the driving factors that impact spatial correlation systems from both internal and external perspectives. The research indicates that China’s level of high-quality development has consistently improved between 2006 and 2020. The spatial correlation network has increasingly become more connected, while the eastern provinces, specifically Shanghai and Beijing, have a significant influence in the spatial correlation of high-quality development. However, the central and western provinces, such as Xinjiang and Inner Mongolia, occupy peripheral positions in this network. Furthermore, clear spatial correlation and spillover effects are apparent among the dimensions. From an internal standpoint, innovation, greenness, openness, and sharing are the key factors that contribute to establishing a high-quality development network. In addition, external elements such as financial development, social consumption, and convenient transportation are interconnected in space, which promote the creation of a high-quality development network. Local protectionism and population concentration impede the establishment of a high-quality development network. Full article

Haze pollution not only has negative impact on public health and air quality, but also has restricted China’s industrial upgrading and high-quality development, and Chinese urban agglomerations are one of the areas hardest hit of haze pollution. In the process of China’s economic transformation, local governments will adopt local protectionism, leading to market segmentation. This is a phenomenon that refers to the distortion of resource allocation by local governments for the sake of vested interests and the existence of segmentation in commodity markets. This behavior is considered to be one of the important factors causing haze pollution. As Yangtze River Delta urban agglomerations are considered to be one of the earliest, fastest growing, and most mature for market integration in China, there is a lack of empirical testing on the impact of market segmentation on haze pollution in this urban agglomeration. Based on urban panel data from the period of 1998–2018 and the market segmentation index calculated by the relative price method, we use the dynamic spatial Durbin model and generalized space two-stage least squares method to explore the effect of market segmentation in urban agglomeration on haze pollution; the results are as follows: (1) Market segmentation significantly exacerbates haze pollution, in other words, haze pollution will increase by 2.14% when market segmentation increases by 1%. (2) Cities with a high degree of market segmentation and high levels of haze pollution have the potential to reduce pollution through market integration in the future. (3) Market segmentation in surrounding regions also has a significant worsening effect on haze pollution in the region. The indirect effect of market segmentation is 3.67 times that direct effect, indicating that the spatial spillover effect of market segmentation on haze pollution is greater than its own impact. (4) Mechanism analysis finds that it will aggravate haze pollution by hindering economic scale, industrial structure, and technological progress when the degree of market segmentation is high. Full article

The cross-regional diffusion of low-carbon technology knowledge is conducive to the development of low-carbon technology and increases the emission reduction contribution of the wider land. However, the flow of low-carbon technology knowledge faces many obstacles such as information, geography, and local protectionism. This paper focuses on whether and how information infrastructure construction can promote the flow of low-carbon technology knowledge under the digital wave. Through the low-carbon technology patents of category Y02 under the classification standard of Cooperative Patent Classification (CPC) and by matching them to the city level to measure the low-carbon technology knowledge flow, empirical research finds that: information infrastructure cannot only directly promote the low-carbon technology knowledge flow, but also indirectly promote the low-carbon technology diffusion by increasing foreign direct investment and human capital. The role of information infrastructure in promoting low-carbon technology knowledge is more obvious in the central and western regions and non-resource-based cities. Finally, in view of the current development situation of low-carbon technology knowledge flows in China, the paper puts forward policy recommendations to vigorously promote the construction of information infrastructure, to gradually increase the network density and the number of network nodes, release the digital economic dividend, and form a spatial pattern of coordinated development of regional knowledge flows. Full article

How to effectively break down market segmentation and build a sustainable and unified domestic market has become critical to achieving high-quality development in the Chinese economy nowadays. This study examines the effects and mechanisms of improved judicial independence on the development of larger and more sustainable domestic supply chains, using a sample of Chinese enterprises from 2011 to 2016 and a quasi-natural experiment of local judicial reforms. We find that, after the establishment of local circuit courts, the distribution distance of a firm’s supply chain increases significantly. The mechanism analysis suggests that the increase in distribution distance in the domestic supply chain is due to the breakdown of market segmentation resulting from the reduction in local judicial protectionism and the improvement in the quality of local justice after the establishment of circuit courts. Further tests show that the impact of improved judicial independence on the domestic supply chain is most pronounced among small and manufacturing non-state-owned enterprises and those from less competitive industries. Overall, the findings of this paper provide important insights into developing large and sustainable supply chains via breaking down market segmentation, thereby promoting long-term economic growth. Full article

Environmental regulation (ER) and local protectionism (LP) are important policy tools for Chinese local governments to improve the environment and promote growth, respectively, but we know little about their interplay in dealing with pollution-intensive industries and enterprises. Using spatial correlation analysis and spatial panel simultaneous equations models, we investigated the spatial characteristics and interactions of the ER and LP in China’s 285 prefectural cities. We found that the high-ER-intensity areas were spreading from the eastern to the central and western regions, and the patterns of LP transited from high in the north and low in the south to high in the west and low in the east. There was a negative correlation spatially between ER and LP. LP could inhibit the increase in ER intensity, while the continuously increasing ER intensity could restrict LP through the competitive behavior from the “race to the bottom” to the “race to the top” among local governments. The effect of ER restricting LP was significant from 2008 to 2013 and prominent in the east, which was dominated by “race to the top” competition, while LP had a greater inhibitory effect on ER in the central and western regions, which preferred to obtain tax revenues from pollution-intensive industries. The results imply that removing the roots of local protectionism, improving the environmental governance system, and formulating differentiated regional environmental regulatory measures will help local governments balance economic growth and environmental protection. Full article

China’s recent development has been nothing short of remarkable, but energy-saving, and environmental protection is still a serious problem. The improvement of energy efficiency (EE) is an important factor for China to better follow the path of energy conservation, sustainable development, and environmental protection. Meanwhile, market segmentation is a unique phenomenon in the process of China’s economic development. Hence, studying market segmentation on energy efficiency has positive significance for improving energy efficiency. The major objective of this study is to investigate the relationship between EE and market segmentation. This paper measures market segmentation by the Price-Based Approach, calculating EE by super slack-based measure (super-SBM), and integrated spatial Durbin model and geographically weighted regression model. Based on the panel data of 30 provinces in China from 1995 to 2018, this paper finds that: (1) Regional market segmentation has a significant negative effect on EE. Moreover, in terms of spatial effect, market segmentation has a positive spatial spillover on EE estimated by 0-1 matrix suggesting that market segmentation in the surrounding area has a positive impact on local EE. (2) The negative effect of Market segmentation on EE demonstrates the obvious regional difference: Eastern region > central region > western region. In addition, geographically weighted regression results show that the impact of market segmentation on EE shows that in regional spatial distribution, Shanghai, Jiangsu, Zhejiang, and Anhui have the strongest negative effect, second in Fujian, Jiangxi, Shandong, Henan, Hubei, Beijing, Tianjin, and Hebei. (3) This paper confirms that market segmentation can affect EE through local protectionism, technological difference, and scale effect. Finally, through the above research basis, put forward the corresponding policy suggestions. Full article

An environmental management system provides the institutional foundation for sound environmental governance. Conventional environmental management systems, deriving from the combination of the vertical management of competent authorities and the localized management of local governments, can lead to local protectionism and implementation deviation at the local level. Since 2016, environmental vertical management reform has been performed as a significant part of the overall promotion of the ecological civilization in China. Representing the most fundamental reform of China’s local environmental management system since the Environmental Protection Law of 1989, the environmental vertical management reform focuses on the reconstruction and adjustment of the environmental management functions among the local governments, and their environment protection authorities at the provincial, city, and county levels. In this paper, we provide an overview of the basic theory of the vertical management model, as well as the motivation for—and the legal/policy background, focuses/content, local practices, and results of—the environmental vertical management reform in China. In the discussion section, we analyze the current problems that impede the effectiveness and sustainability of this reform. On the basis of the analysis of the present and the problems, we raise the question of whether this round of reform is effective and will be sustainable in the future. In response to the challenges, feasible recommendations are proposed. These suggestions include firmly promoting the rule of law in the process of implementing the reform, enhancing the institutional supply and capacity building at the grassroots level, and taking advantage of the holistic governance under the leadership of the Communist Party of China (CPC). Full article

The concept of an autarky has a long history and meaning related to its negation and unpopularity. In liberal schools of economics, autarky is usually considered from the perspectives of economic trade protectionism, closed economies, and threats to welfare. Nevertheless, the concept of autarky has gained a new meaning, understood as the local utilization of renewable energy resources from the perspective of their inter- and intragenerational distribution. Local action is shaped by the global perspective. This research consists of three steps. First, a model of energy autarky has been offered based on the system theory. The model shows the variety of the structures and features of energy systems offered in today’s debates on energy autarky. Second, the key postulates of sustainable development have been presented to define an autarkical sustainable energy system. Finally, the concept of bioenergy villages in Germany has been presented to illustrate the approach to energy autarky. The research shows that the concept of autarky and single solutions, such as the use of renewable resources, are not themselves a success from the perspective of sustainable development; this misunderstanding is well illustrated by the evolution of the German concept of bioenergy villages into smart villages. Full article

Resource depletion and environmental degradation have become serious challenges for China’s sustainable development. This paper constructs indicators to assess China’s green economy performance and green productivity growth, in which economic expansion, resource conservation and environmental protection need to be incorporated simultaneously. For this purpose, we combine non-radial directional distance function and meta-frontier Malmquist productivity to develop the indicators. The methodology also allows for the decomposition of driving forces of China’s green economy. Moreover, the dataset employed in this paper allows for the evaluation of 275 cities in China during the period 2003–2012. The main findings are as follows. First, most of China’s cities did not perform efficiently in terms of the green economy, with an average score of only 0.233. Second, the growth rate of green productivity is slower than real GDP, and the green productivity growth in China is only moderate. Third, innovation is the main driving force of China’s green productivity growth, but the central region lags behind when it comes to green innovation. Fourth, artificial local protectionism and transport limitations impede the progress of cities that perform ineffectively in the green economy. Based on our empirical findings, we provide policy implications and suggestions for enhancing China’s green economy performance and productivity growth. Full article

China had set an ambitious development target of electric vehicles (EVs) to mitigate the environmental pollution. However, the actual situation of EVs far lagged behind the goals. This paper analyzes the elements impeding EVs’ development, which are identified into four contributors, including deficient EV subsidy policies, embarrassed EV market, local protectionism, and unmatched charging infrastructure. Based on the actual situation of China, this paper discusses corresponding policy suggestions and explores the alternative roadmap of EVs. In the initial development stage of EVs, it is important to select the appropriate charging mode for EVs according to different characteristics across users. Moreover, the development of hybrid electric vehicle (HEV) may open the EV market faster than battery electric vehicle (BEV). In addition, the low-speed EVs may be a good choice for the rural market and should be well developed. With the promotion of EVs, China central and local governments should make rational policies to promote EVs’ development, which is the crucial force to drive the uptake of EVs. Full article