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Does water rights trading promote resources utilisation efficiency and green growth? Evidence from China's resources trading policy

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  • Pan, Junyu
  • Peng, Jie
  • Yang, Xiaodong
  • Xuan, Siyuan

Abstract

Strengthening ecological protection and resources management is imminent under the international context of net water resources shortage and ensuring green growth agenda. In this regard, this study employs a difference in differences (DID) model to assess the impact of China's water rights trading policy (WRT) on resource use efficiency from 2009 to 2021 using 281 prefectural-level cities in China. The results suggest that the WRT significantly enhances regional water use efficiency and supports regional green growth. The policy effects of WRT are more evident in coastal areas, areas where water supply capacity is strong, areas where water resources endowment is high, and areas where cross-regional water rights trading policy is implemented. WRT improves resources use efficiency by promoting technological innovation and improving the quality of water sources. WRT can also enhance regional welfare, but it has been observed to reduce water use efficiency in provincial border cities. These results offer valuable suggestions for all stakeholders.

Suggested Citation

  • Pan, Junyu & Peng, Jie & Yang, Xiaodong & Xuan, Siyuan, 2023. "Does water rights trading promote resources utilisation efficiency and green growth? Evidence from China's resources trading policy," Resources Policy, Elsevier, vol. 86(PB).
    • Handle: RePEc:eee:jrpoli:v:86:y:2023:i:pb:s0301420723009467
    DOI: 10.1016/j.resourpol.2023.104235
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