Market segmentation impact on industrial transformation: Evidence for environmental protection in China

Lai, Aolin; Yang, Zhihui; Cui, Lianbiao

doi:10.1016/j.jclepro.2021.126607

Cited by 32 publications

(11 citation statements)

References 55 publications

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“…However, market segmentation can encourage local protectionism, ultimately negatively impacting regional economic growth efficiency. Lai et al (2021) highlight that market segmentation has an inverted U-shaped effect on the current and future industrial transformation of the region, which is key in improving GTFP.…”

Section: Market Segmentation and Green Total Factor Productivitymentioning

confidence: 99%

Analyzing the Effect of Local Government Competition on Green Total Factor Productivity From the Market Segmentation Perspective in China—Evidence From a Three-Stage DEA Model

Tang

Fang-ming

2021

Front. Environ. Sci.

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Under both Chinese-style fiscal decentralization (vertical competition) and promotion tournament systems (horizontal competition), the economic development system used by the government determines whether local government competition significantly influences green total factor productivity (GTFP). Moreover, market segmentation, an important strategic tool for local government competition, will significantly impact GTFP because of the implied changes in production efficiency and blocked factor flows. This study applies GMM and the mediation effect model to explore the relationship between local government competition and GTFP from the market segmentation perspective using statistical data from 30 provinces from 2006 to 2017 in China. Overall, our results demonstrate that local government competition significantly inhibits GTFP promotion. Local government competition also has a negative impact on GTFP by promoting market segmentation. As a mediating variable, the market segmentation coefficient was statistically significant. Considering regional heterogeneity, in the eastern region, local government competition has no significant inhibitory effect on GTFP. Moreover, market segmentation has no intermediary effect. In the central and western regions, GTFP remains significantly inhibited by local government competition, and the mediation effect of market segmentation is significant. Finally, our empirical results are robust.

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Section: Market Segmentation and Green Total Factor Productivitymentioning

confidence: 99%

Analyzing the Effect of Local Government Competition on Green Total Factor Productivity From the Market Segmentation Perspective in China—Evidence From a Three-Stage DEA Model

Tang

Fang-ming

2021

Front. Environ. Sci.

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“…As stated above, industrial transformation improves also the productivity accompanied by the reduction of energy consumption and of environment pollution. Therefore, industrial transformation and upgrading by composition effect has become an important method to arrive environmental protection and green economic growth (Li and Lin 2017;Lai, et al 2021). Previous researches have confirmed the role of industrial transformation and upgrading in promoting sustainable economic growth empirically and theoretically, e.g.…”

Section: Industrial Composition Effectmentioning

confidence: 99%

“…While market integration in China has made progress, local protectionism still exists to varying degrees (Lai et al 2021). Some scholars even believe that China's domestic market is far less integrated (Ke 2015;Sun et al 2020) and is still in a relatively fragmented state due to its decentralization systems and long-term excessive competition among local government (Poncet 2005).…”

Section: Introductionmentioning

confidence: 99%

“…Scholars from the field of economics and environmental science are trying to explain China's green economic growth in terms of industrial structure (Lai et al 2021), resource market distortion (Lin & Chen 2018), environmental regulation (Zhao et al 2018), fiscal decentralization and spending such as energy conservation and emission reduction policies (Song et al 2018;Lin & Zhu 2019), financial development (He et al 2019) and market openness (Ke 2015;Bian et al 2019). However, these analyses are based on the premise that all market participants carry out their economic activities in a relatively complete and effective environment.…”

Section: Introductionmentioning

confidence: 99%

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Market integration and green economic growth—recent evidence of China’s city-level data from 2004–2018

Chen

Huang

et al. 2022

Environ Sci Pollut Res

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Very few studies exist in rationalizing comprehensively the relationship between market integration and green economic growth in China. This paper tries to answer the question whether and how market integration influences regional green economic growth in China. Based on the panel data of 285 city-level regions from year 2004 to 2018 in China, this paper develops explanatory mechanism and discusses the influence theoretically and empirically. To advance the analysis, we construct market integration indicator through relative price variance method based on commodity retail price index and employ the Malmquist-Luenberger (ML) productivity index and DEA-SBM (data envelopment analysis-slacks-based measure) model to evaluate green total factor productivity (GTFP) as indicator for green economic growth. Our empirical findings are: (1) Apparent regional imbalance exists in both the development of market integration and green growth and gaps are expanding from year 2004 to 2018. (2) Market integration promotes regional green growth significantly. (3) Mechanism analysis illustrates that market integration fosters green growth through economies of scale effect, composition effect and spillover effect, respectively. (4) Heterogeneous analysis suggests that the influence from market integration on green growth varies depending on region's difference in traffic situation and in overall development level.

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“…Since the reform and opening up, China has achieved tremendous economic growth owing to its market-oriented reforms, particularly that of permitting the market to play a critical role in allocating resources (Cui et al 2019;Duan et al 2019). History has indicated that rapid economic development depends on efficient free markets, which thrive under integrated rather than fragmented or isolated conditions (Jin et al 2008;Lai et al 2021). The unification of the domestic market promotes competition, the development and application of new technologies, and the gradual standardization of market rules, thus realizing the optimal allocation of resources.…”

Section: Introductionmentioning

confidence: 99%

Can Environmental Regulation Promote Domestic Market Integration? Evidence From China

Lai

Yang

Cui

2021

Preprint

Self Cite

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While local protectionism and market segmentation owing to fiscal decentralization are not conducive to broad economic development, they may be rational choices on a local scale. Based on a spatial Durbin model, we analyzed the relationship between environmental regulations and market segmentation in China using interprovincial panel data for 2004–2018. The results indicated that the “beggar-thy-neighbor” phenomenon persists in China; environmental regulations have a U-shaped impact on market segmentation, i.e., in most regions, environmental regulations strongly promote local market integration. Regions with greater decentralization are better able to promote local market integration through environmental regulation, suggesting that local governments are better able to compensate for market failures when vested with greater power. Hence, we propose that the central government should improve performance evaluation indicators for local governments and grant them greater autonomy; additionally, local governments should increase the intensity of environmental regulations as appropriate, thereby promoting both environmental protection and the unification of domestic markets.

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Market segmentation impact on industrial transformation: Evidence for environmental protection in China

Cited by 32 publications

References 55 publications

Analyzing the Effect of Local Government Competition on Green Total Factor Productivity From the Market Segmentation Perspective in China—Evidence From a Three-Stage DEA Model

Analyzing the Effect of Local Government Competition on Green Total Factor Productivity From the Market Segmentation Perspective in China—Evidence From a Three-Stage DEA Model

Market integration and green economic growth—recent evidence of China’s city-level data from 2004–2018

Can Environmental Regulation Promote Domestic Market Integration? Evidence From China

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