How does global value chain embeddedness affect environmental pollution? Evidence from Chinese enterprises

Wu, Siqi; Wei, Tianlei; Qu, Yue; Xue, Rui; Wang, Huiqing; Shan, Yuli

doi:10.1016/j.jclepro.2023.140232

Cited by 5 publications

(1 citation statement)

References 93 publications

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“…Trade openness leads to the active integration of firms into the global production system. Globalized production produces scale effects on firms, lowering the unit cost of production and thus lowering the firm's energy consumption per unit [16]. A study using data from the Mexican manufacturing sector found that trade expansion leads Mexican firms to adopt cleaner production technologies and thus reduce their pollution emissions [17].…”

Section: Introductionmentioning

confidence: 99%

Trade and Water Pollution: Evidence from China

Yang,

Huang,

et al. 2024

Sustainability

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China’s economy has achieved significant success by integrating itself into the globalized production system over an extended period. However, it is crucial to address the environmental consequences that accompany rapid economic progress. The correlation between trade and environmental pollution is still controversial in the existing literature, with a lack of research specifically investigating this relationship using detailed data at the firm level. Based on the quasi-natural experiment of China’s accession to the WTO, this study uses the DID method to evaluate the causal relationship between trade and the environment experimentally. It is found that trade liberalization significantly increases firms’ industrial wastewater emissions, and the empirical results remain robust after parallel trend tests, placebo tests, and replacement variables. The mechanism of action suggests that trade expansion enhances corporate pollution emissions through two channels: attracting foreign investment into the country and intensifying energy consumption. A heterogeneity analysis reveals that the pollution-enhancing effect of trade expansion on enterprises is mainly concentrated in export-oriented enterprises, labor-intensive industries, and coastal regions. Additionally, further analysis shows that trade liberalization not only has local impacts but also spatial spillover effects on enterprise pollution. It is found that enhancing environmental governance and reducing corruption can effectively mitigate the adverse environmental consequences caused by trade liberalization.

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Section: Introductionmentioning

confidence: 99%