Off-office audit of natural resource assets and water pollution: a quasi-natural experiment in China

The environmental consequences of national Audit governance: An analysis based on county-level data in China

Recent years have witnessed growing public concern over air pollution in China, posing a challenge to the government's environmental management efforts. Empirical evidence indicates that the digital economy contributes to mitigating environmental pollution. Given that national audits are a crucial part of the national oversight system and considering the significant role of digital technology in audit governance, it is relevant to explore how the digital economy can support national audits in enhancing China's environmental quality. This study investigates the environmental impact of national audit governance, utilizing a dataset from 1540 counties in China spanning from 2005 to 2018. The findings reveal that effective national audits contribute to reducing haze pollution (HP) levels, with the digital economy playing a moderating role. The results also demonstrate heterogeneity; national audits are particularly effective in regions characterized by high urbanization rates, severe HP, and stringent environmental regulations. The mechanism analysis suggests that industrial transformation and enhanced government governance are the key mechanisms through which national audits reduce regional HP. Additionally, reforming the audit management system can amplify the effects of national audits on reducing HP.

Leading officials' audits of natural-resource assets and local environmental attention: evidence of word frequency analysis from Chinese local government work reports

Drawing on the textual contents of the Chinese local government work reports, this paper focuses on the impact of leading officials' audits of natural-resource assets on the local environmental attention allocation. The study has found that during the pilot period of audits, compared with the non-pilot cities, the local government in the pilot cities has concentrated more on the ecological environment field and has placed greater emphasis on the actual environmental governance. The results of mechanism analysis show that differences in the personal and take-office characteristics of local officials, may lead to different promotion pressure and performance evaluation modes, and then have a different impact on local environmental attention. The test results of consequence analysis show that the environmental attention in the pilot cities can be further transformed into environmental administrative and financial governance behavior. The paper discusses the policy effect and internal mechanism of leading officials' audits of natural-resource assets from the perspective of local governments' environmental attention, providing empirical evidence for China to carry out the top-level design of environmental policy based on the idea of optimizing officials' performance evaluation mechanism.

Public participation and outgoing audit of natural resources: Evidence from tripartite evolutionary game in China

Public participation is essential to the success of ecological civilization. Whether public participation can effectively play a role in the outgoing audit of natural resources (OANR) is an important issue that remains to be explored. This paper uses the tripartite evolutionary game to explore the mechanism of the audit subjects, the leading cadres, and the public in the OANR. The research finds that there is a two-way linkage relationship between the audit subjects and the leading cadres. The audit subjects and the leading cadres affect the behavior strategies of the public in the indirect way and direct way, respectively. However, the public lacks the path to directly affect the other two subjects. The tripartite ideal audit model of "the audit subjects conduct due diligence audits, leading cadres perform duties, the public participate" cannot be realized. The external effect of the public's strategic choice is not enough to make the profit or loss of leading cadres change structurally and then change their behaviors. This paper demonstrates the reasons why the public cannot effectively participate in the OANR at the current stage from three aspects, which are the interpretation of the equations for replication dynamics, the particularity of the audit system, and the effectiveness of public participation. Three suggestions are put forward which are encouraging citizens' indirect participation in the OANR, disclosing information about the OANR, and improving citizens' awareness of the OANR. This paper has important guiding significance for other developing countries to promote public participation in natural resource auditing.

The impact of Water Ecological Civilization City Pilot on urban green innovation: the case of China

As an essential part of ecological civilization, water ecological civilization has significant influence on the green and sustainable development of cities. Under the background of China's Water Ecological Civilization City Pilot (WECCP), based on data from 275 cities in China from 2007 to 2019 by using the difference-in-differences (DID) model, we empirically analyzed the influence of the WECCP establishment on urban green innovation and explored the impact mechanism in depth using a mediating effect model, which aimed to verify whether the "Porter hypothesis" holds true in China. The result indicated that the WECCP had made a remarkable contribution to enhancing urban green innovation in the pilot cities. Further research found that the input mechanism played an important mediating role. In addition, the heterogeneity test indicated that cities in the central region, at low administrative levels, and in the first batch of pilots gained more from the policy establishment. This paper has theoretical implications for understanding the derived innovation benefits of the environmental policy, practical implications for identifying new drivers of urban innovation, and provides related experience for the country to further promote and expand water ecological civilization construction and useful policy inspiration for other developing countries to formulate ecological and environmental policies.

The outgoing audit of natural resources assets and enterprise productivity: New evidence from difference-in-differences-in-differences in China

Despite increasing evidence documenting the role of the outgoing audit of natural resources (OANRA) in environmental governance and enterprise innovation, little is known about its impact on enterprises' total factor productivity (TFP). To address this question, we treat the OANRA policy launched in 2014 in China as a quasi-natural experiment. We adopt a difference-in-differences-in-differences (DDD) method that exploits three-dimensional variations: city (i.e., OANRA cities versus non-OANRA cities), industry (i.e., more polluting industries versus less polluting ones), and year (i.e., before and after the OANRA policy). Employing a dataset of Chinese industrial listed companies from 2012 to 2019, we reveal that after the OANRA implementation, enterprises' TFP in more polluting industries of OANRA cities decreases by 4.0%. Our mechanism analysis shows that the OANRA restrains the TFP by reducing the financing scale of enterprises and increasing environmental investment of governments. Further, the heterogeneity analysis finds the inhibitory effect of the OANRA is more prominent in large-scale and state-owned enterprises, as well as enterprises located in eastern, low fiscal pressure, and high pollutant emission cities. Our findings provide support for the neoclassical economics hypothesis that the OANRA increases enterprises' compliance costs and decreases their productivity.

Leading officials' accountability audit of natural resources and haze pollution: evidence from China

Leading officials' accountability audit of natural resources (AANR) is a major institutional arrangement for China to promote the construction of an ecological civilization. Based on city-level panel data from 2010 to 2017, this study investigates the role of AANR on haze pollution by the difference-in-differences (DID) and spatial DID models. The results show that the AANR significantly reduces the haze pollution of pilot cities, and this conclusion remains robust under multiple scenarios, such as the parallel trend test, tendency score matching, placebo test, and excluding the policy interference in the same period. The AANR promotes the governance of haze pollution in pilot areas, mainly by improving environmental control and increasing financial investment in environmental protection. Furthermore, the promotion effect of the AANR on haze governance has strong heterogeneity with regard to urban air quality; eastern, central, and western regions; legal environment; and public attention. The AANR not only reduces the haze pollution of pilot cities but also has a spatial spillover effect on neighboring areas, but this effect is not pronounced. Therefore, it is of great significance for haze pollution control to continuously promote and improve the departure audit of natural resource assets, perform audit work according to local conditions, and establish interregional cooperative mechanisms.

The effect of China's leading officials' accountability audit of natural resources policy on provincial agricultural carbon intensities: the mediating role of technological progress

China is one of the largest agricultural countries in the world. In the context of China's efforts to achieve dual carbon goals (carbon peak and carbon neutral), the need for carbon emissions reductions in the agricultural sector cannot be ignored. This study collected 2007 to 2018 data from 30 Chinese provinces and used a difference in differences (DID) model to investigate the relationships between China's leading officials' accountability audit of natural resources policy (LOAANR), agricultural technological progress, and agricultural carbon emissions intensities (CEI). A common trend test, placebo test, PSM-DID, and other test methods were used to verify the reliability of the results. The results show that (1) compared with the non-pilot areas, the policy implementation could significantly reduce CEI; (2) the LOAANR was able to stimulate patented technological progress (ATI) and mechanical technological progress (AMT), but different types of technological progress had different mediation effect sizes; and (3) the policy effects shows obvious regional heterogeneity, manifesting as west > east > central; and the policy effects were more obvious in the non-major grain-producing areas, but had no inhibition effects on the CEI in the major grain-producing areas; compared with low intensity market-based environmental regulation (MER) regions, high-intensity MER regions have stronger LOAANR emission reduction effects. Based on the study findings, policy suggestions are given to reduce agricultural carbon emissions and promote higher quality agricultural development.

The Effect of Air Pollution Control Auditing on Reducing Carbon Emissions: Evidence from China

Analyzing the carbon-emission-reduction mechanism from the perspective of air pollution control auditing is of great practical significance for China to implement the dual-carbon strategy. Based on the panel data of 30 Chinese provinces from 2004 to 2018, we examine whether and how the auditing of air pollution control has an impact on carbon emission reduction by using multiple regression method and the mediating analysis. Our analyses show that air pollution control auditing can significantly restrain carbon emissions but has no impact on carbon emission intensity. Further research suggests that (1) the bottom-up audit represented by local audit institutions is more effective than the top-down audit represented by the National Audit Office; (2) air pollution control auditing follows a simple and direct method to curb carbon emissions by output reduction, regulation, and shutdown, rather than promoting technological progress and green transformation of enterprises in a high-quality development mode. Those findings provide an improvement direction for air pollution control auditing to contribute to carbon emission reduction and supply relevant policy references for implementing the dual carbon strategy.

A sequential game-play modelling on forest-title mortgage loans based on Chinese forester resource and assets valuation

Forest management has become a critical strategic action because of forests’ diverse role in the nature conservation and bio-economic benefits. Forest-title mortgage loan (hereafter abbreviated as “the loan”) which is one of forest management methods not only transforms the “sleeping” resources of a forester in her/his forest into assets mortgageable for cash, but also plays a key role in alleviating the shortage of funds that a forester might encounter, promoting financial innovations, and protecting forest resources. As such, this paper examines the problem of the low limit placed on this loan in China, and draws the following conclusion from employing the dynamic game method comprising complete information: in the actual mortgage market where banks hold an absolute advantage in issuing mortgage loans to the borrower (whether or not a forester acting as the borrower here applies for this loan from the bank through using an asset-appraisal agency) the amount of loan approved for the forester is going to be lower than the actual market value of the forest-resource assets that the forester owns. At the same time, based on the above conclusion, this paper proposes certain suggestions regarding how to raise the limit of this loan for the forester. These suggestions include proposals pertinent to the governmental policy support, introduction of innovative credit products developed by the banks, as well as the elaboration on how foresters could integrate their forest-resource assets by using cooperatives and launching scaled productions.

Regional water pollution management pathways and effects under strengthened policy constraints: the case of Tianjin, China

In recent years, China has attached great importance to pollution control, and national and many provinces have introduced water pollution management policies in the hope that improvements can be made. However, there is currently a lack of objective and adequate assessment of the effectiveness of water pollution management (WPM) at the regional level, especially a lack of in-depth research on the causes of improvement, key measures, and pathways of action. This paper constructs an evaluation index system based on the driver, pressure, state, impact and response (DPSIR) model and evaluates the WPM performance of Tianjin based on the five aspects comprising the DPSIR model. The results show that WPM performance in Tianjin has been commendable, improving from 76.15 points out of 100 in 2014 to 90.93 points out of 100 in 2018. The score increased more rapidly from 2016 to 2018 after the regional policy was implemented. The main reason for this encouraging phenomenon is the significant improvement in water quality. From 2016 to 2020, the closure of high pollution industrial enterprises and the regulatory management of aquaculture have significantly reduced pollutant emissions. At the same time, under the constraints of the river chief system, pollutant discharge permits, discharge standards, ecological compensation agreements on water pollution and other policies in Tianjin, the effect of pollution source control is obvious, with improved water quality and high public satisfaction.

Does diversified environmental regulation make FDI cleaner and more beneficial to China's green growth?

With the internationalization and financial development, it is urgent to explore the effect of foreign direct investment on green economy under the context of multiple environmental regulations. By using the provincial panel data in the period of 2000-2016, the paper adopts the System Generalized Method of Moments and threshold models to detect the moderating effect of diversified environmental regulation on the nexus between foreign direct investment and green growth in China. The empirical results reveal that foreign direct investment has direct positive spillovers on China's green growth and supports the "pollution halo" hypothesis. There is a threshold effect of command-and-control regulation that exists in foreign direct investment's spillovers to green growth. Stricter command-and-control regulation can stimulate foreign direct investment's spillovers on green growth in China; however, market-based and informal regulations fail to. Some suggestions are proposed for constructing a matched and compatible policy system of foreign direct investment, environment protection, and economic growth by adjusting the intensity, tools, and enforcement of corresponding policies.