The Impact of Dual Environmental Regulations Within the Digital Economy on Inclusive Green Development: Evidence from 30 Provinces in China

This paper examines the impacts of formal and informal environmental regulations on inclusive green development in 30 Chinese provinces from 2011 to 2021 within the context of the digital economy. Inclusive green development is quantified using the Inclusive Green Total Factor Productivity Index. The findings reveal that formal regulations significantly promote inclusive green development through the “innovation compensation” and “employment promotion” effects, whereas informal regulations hinder such development due to the “compliance cost” effect imposed on enterprises. The digital economy amplifies the “compliance cost” and “employment suppression” effects of formal regulations, it reduces the compliance costs associated with informal regulations by enhancing information transparency. Spatial effect analysis further shows that stringent regulations may prompt enterprises to relocate to regions with looser regulatory environments, forming “pollution havens” that degrade environmental quality in surrounding areas. These negative spillover effects outweigh any potential local economic and social benefits.