Publications
Window Dressing: Changes in Atmospheric Pollution at Boundaries in Response to Regional Environmental Policy in China
Journal of Environmental Economics and Management, Volume 125 (May 2024)
[Journal link] | [manuscript]
Abstract: In decentralized environmental governance, local governments are likely to adopt the "beggar-thy-neighbor" strategy to relax regulations at boundaries. This study investigates the impact of China's Joint Atmospheric Prevention and Control Policy (JAPCP) in "2+26" cities enforced by the central government on pollution at provincial boundaries. The theoretical model suggests that dual incentives for environmental protection and economic growth may prompt local governments to reduce boundary pollution within the JAPCP-covered area while relocating pollution to uncovered boundaries. Based on Shandong Province data using the difference-in-differences approach, our analysis reveals a 9.6% decline in the air quality at JAPCP-covered boundaries compared to non-boundary areas and a 5.3% increase at JAPCP-uncovered boundaries, which is associated with migration of key regulated industries. Through examining annual work reports, we provide evidence that local governments modify regulatory intensity at various boundaries. These findings indicate that, while regional environmental policies are intended to promote inter-jurisdictional cooperation, the local government responses lead to unintended costs.
Working Papers and Selected Works in Progress
Lineage Ties and Migration Dynamics: Clan Strength, Policy, and Demographic Divergence in Qing China
(in progress)
Regional Integration within National Segmentation: Multilayered Boundary Effects of Labor Market in Late Imperial China
[working paper (coming soon)]
The "Demons" in Demonstration: Unintended Consequences of Superstar-oriented R&D Subsidy Policy in China
[working paper (March 2025)]
Abstract: This paper investigates the unintended consequences of selective R&D subsidy policies targeting leading firms on the innovation activities of non-subsidized competitors and new entrants. While such subsidies are typically designed to stimulate innovation, the paper employs a Schumpeterian model to argue that they can discourage innovation among competitor firms and deter new entrants, ultimately undermining aggregate innovation. Empirical evidence from the "National Technological Innovation Demonstration Enterprise (NTIDE)" policy in China supports these predictions, revealing a 30% increase in R&D spending by subsidized firms, but a 13.3% reduction in R&D by competitor firms and a 5.9% decline in the entry of private firms. Furthermore, the policy results in a 13.5% decrease in patent outputs at the corresponding industry and city levels where the certified demonstration enterprises are located. The paper underscores the importance of considering competitive dynamics when designing innovation policies and provides new insights into the effects of selective subsidies on market competition and innovation.
Land Titling Reform and Spatial Redistribution: Mitigating Effects of Urban Construction Land Allocation
"Outstanding Paper" at The 1st Economic Thought Theory and Practice Forum (2023)
Presented at:
- The 1st Economic Thought Theory and Practice Forum, Zhejiang, China (2023)
[working paper (January 2024)] | [slides (in Chinese) (December 2023)]
Abstract: This paper explores the impact of land titling reform on population mobility and its economic effects in China. Using a quantitative spatial model that accounts for imperfect land ownership and targeted urban construction land allocation, I find that the reform significantly boosts rural-to-urban labor migration, improving labor allocation efficiency and raising national welfare. However, without changes in land supply, labor mobility causes regional redistribution effects, negatively impacting local residents in the urban sector. My analysis shows that the planning allocation of urban construction land by China's central government during 2010 and 2017 mitigated these redistribution effects. Additionally, simulations of optimal land allocation suggest that China's current land allocating pattern places too much emphasis on regional balance at the expense of economic efficiency.
Coordinated Development of the Yangtze River Delta in China: A Quantitative Assessment of the Negotiation System
(in Chinese, the earlier version is my Bachelor's thesis)
Presented at:
- The 21st China Youth Economists Forum, Beijing, China (2023)
- The 3rd Political Economy of Socialism with Chinese Characteristics in the New Era Forum, Fujian, China (2023)
[working paper (in Chinese) (October 2023)]
Abstract: Promoting coordinated urban development through city clusters is a key challenge for developing countries. In China’s Yangtze River Delta (YRD), the inter-city negotiation system, through mayors' conferences and policy cooperation, enhances labor division and resource mobility, advancing regional integration. Reduced-form estimation shows that the system promotes population agglomeration and income convergence among cities. We then incorporate these estimates into a quantitative spatial general equilibrium model, which finds that the system reduces population mobility costs between Shanghai, Zhejiang, and Jiangsu by 52.9%, 49.7%, and 44.9%, respectively. Welfare analysis reveals a 7.6% gain for YRD residents and 1.6% nationally. However, population inflows into Shanghai may cause redistribution effects, manageable by linking construction land allocation to population changes.