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Analysis on the Mechanism of Transmission of Environmental Policy Promoting Regional Economic Development

Author: WanJianXiang
Tutor: MeiGuoPing
School: Jiangxi University of Finance
Course: Management Science and Engineering
Keywords: Environmental policy Economic development Transmission mechanism Poyang lake eco-economic Zone
CLC: F205;F127
Type: PhD thesis
Year: 2011
Downloads: 207
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Abstract


In china, the average per person of resource and energy is lower than that of world level, but consumption is far above. The "low owns, high consumption" development style makes resources capacity hard to tolerate, and "high emissions" caused by "high consumption" will become the bottleneck of the economic development if the mode of economic development is not changed; meanwhile, on 12 December 2009, the State Council officially approved the construction planning of Poyang Lake ecological economic zone, marking the construction to become national policy. The construction of Poyang lake economic is not only a major strategic initiatives of Jiangxi province to outpace other province and accelerate the speed of rising in the middle region, but also provides model for the rest of the nation to explore the ecological environment and economy coordinated development; what’s more, due to the factors of incomplete consideration and single methods applications, the existing research about the relationship between environmental policy and economic development, failed to fully reveal the mechanism of how the environmental policy promoting economic development, which makes the mechanism behaving as a strong "black cartridge" Therefore, it is of great significant to study whether environmental policy could promote and how to promote regional economic development and help the construction of Poyang lake ecological economic zone.Basing on the above, this paper is based on the theoretical analysis of endogenous economic growth theory, mathematical analysis of Hamilton optimization model and empirical analysis of space econometric. Three propositions are proposed and demonstrated:First, transmission path exists, that is, the environmental policy could promote regional economic development through elements accumulation such as motivating technological progress. Second, transmission intensity is measurable, which means under different transmission path the strength of given environment policy to stimulate production elements accumulating, and then promote the economic development is measurable. Third, environment policy performance is comparable, that is, the performance of different environmental policy on equilibrium increasing rate is comparable. Finally, according to the conclusion, environmental policy of the Poyang Lake Ecological Economic Zone is simulated:forecast the development of the environment and economy under a given combination of environmental policy; set the ecological and economic zone’s economic, environmental strategic objectives, simulate the policy and related conditions required, play the role of policy lab and put forward policy recommendations for the construction of Poyang lake eco-economic Zone. This study has important academic values, while has important practical value to China’s economic development, especially to the Poyang Lake Ecological Economic Zone.Compared with those of similar domestic and foreign research, this paper’s innovation is mainly embodied in the following respects:(1) We construct and solve 7 dynamic Hamilton optimization model one by one, deeply deplore the mechanism by which environment policy promote economic development.The concrete models are as follows:Neoclassic growth model, named MODEL1 (with environment externality introduced, no government involved); Neoclassic growth model with government and necessary environmental policy introduced, named MODEL2; New economic growth model with technology advancement introduced, named MODEL3 (corresponding to the transmission path 1); New economic growth model with human capital accumulation introduced, named MODEL4 (corresponding to the transmission path 2); New economic growth model with material capital accumulation introduced,,named MODEL5 (corresponding to the transmission path 3); New economic growth model with social capital accumulation introduced, named MODEL6 (corresponding to the transmission path 4); The compound model with the above 4 paths synthesized, named MODEL7 (corresponding to the compound transmission paths). By constructing and settling the 7 models one by one, we deduce the mechanism by which environmental policy promote the economic development, either one policy under different path, or different policies under the same path, also we compute the degree and elasticity that environment policy works on economic growth and environment protection, such is the third important innovation.(2) Explore endogenous accumulation process of social capital, and thus make the mechanism clear by which social capital promotes economic development.Set the social capital endogenous and relate it with the pollution tax rate, by constructing and settling Hamilton dynamic optimization model, we explore endogenous accumulation process of social capital and mechanism by which social capital promotes economic development. We settle the problem that the existing literature set social capital exogenous and did not consider its accumulation, compared with Owen and Videras(2006),Torgler and Garcia-Valinas(2007). Moreover, the social capital accumulation equation we put forward reflects social capital own essential connotation compared with Roseta-Palma (2010).(3) Provide empirical proof about how and what degree social capital accumulation promotes economic growth and environmental protection.By using panel data and GMM estimation, we pass the robustness test and the reliability test. Solve the existing research flaw(Hang Sheng Professor 2005, Zhang Shuhui 2010 just developed the qualitative analysis on social capital just taking it as one kind of new forms of capital; Wu Xiaolu 2010 analyzed how social capital promoting economic growth by structural explaining model).Therefore, this empirical research and the mathematical analysis of fourth chapter constitute new attempt of social capital accumulation research, also being the second important innovation.

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