Environmental Effects of Trade Liberalization–Evidence from China’s Pilot Free Trade Zone

Abstract

Free trade zone (FTZ) in China has been demonstrating remarkable achievements since its establishment, yet its effects on the environment in the zones cannot be ignored. However, there is still a lack of research on the impact of the quasi-natural experiment in the China pilot FTZ on China’s environment. Based on this, this paper uses panel data from 196 cities in China from 2010 to 2017 and uses the propensity score matching and difference in difference (PSM-DID) model to empirically test the environmental effects of the establishment of the FTZ. The result shows that there is an obvious causal relationship between the establishment of the FTZ and environmental quality. The establishment of the FTZ has exacerbated the environmental pollution problem in the pilot zone. Through a series of robustness tests, it is concluded that the estimated results of the benchmark model are robust. However, after a further study on whether the effect of the FTZ on environment is time varying, it was found that the effects of the FTZ on the environmental pollution in the test zones gradually weakened over time, which means that with the gradual maturity of China’s free trade pilot zone, the positive effect on environmental improvement will gradually highlight.

A Knowledge Map Study of an Application of a Smart Land Planning Free-Trade Zone and China’s Contribution

“…We can infer that China will show a steadily upward trend of FTZ research in the future, along with more economic experiments and pilot open policies. In fact, scholars have already examined China's FTZ effects on regulatory innovation [76], income disparity [77], green production [25], transportation efficiency [78], and environmental effects [79]. This progress substantiates the upward trend, and we believe the breadth and depth of FTZ research will be enhanced further.…”

The Impact of Digital Transformation on Corporate Sustainability: Evidence from Listed Companies in China

“…In addition, we further analyzed the contribution of the two mechanisms. Referring to the framework for mechanism analysis based on the marginal effect proposed by Wang et al (2022) [61], the premise of the application is that the number of explained variables should be greater than the number of mechanism variables. Therefore, five subdivided indicators of digital transformation were used, involving artificial intelligence, cloud computing, blockchain technology, big data and digital technology applications.…”

Addressing the COVID-19 Shock: The Potential Job Creation in China by the RCEP

“…China’s services trade liberalisation level reaches the highest level of existing free trade agreements [ 31 ]. Firstly, the number of committed service sectors has increased by 22 from the approximately 100 sectors committed by China’s accession to the World Trade Organisation, mainly in 11 areas such as management consultancy-related services, manufacturing-related services, professional design services, elderly care services, sports and entertainment services, passenger transport services, market research services, personnel placement services, beauty and hairdressing services, building cleaning services, printing services, and 11 other areas.…”