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Endogenous enforcement and effectiveness of China's pollution levy system

  • Hua Wang
  • Wheeler, David
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The authors investigate two aspects of China's pollution levy system, which was first implemented about 20 years ago. First, they analyze what determines differences in enforcement of the pollution levy in various urban areas. They find that collection of the otherwise uniform pollution levy is sensitive to differences in economic development and environmental quality. Air and water pollution levies are higher in areas that are heavily polluted. Second, they analyze the impact of pollution charges on industry's environmental performance, in terms of the pollution intensity of process production and the degree of end-of-pipe abatement for both water pollution and air pollution. Econometric analysis shows that plants respond strongly to the levy by either abating air pollution in the production process or providing end-of-pipe treatment for water pollution.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 2336.

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Date of creation: 31 May 2000
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Handle: RePEc:wbk:wbrwps:2336
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  1. Dasgupta, Susmita & Wheeler, David, 1997. "Citizen complaints as environmental indicators : evidence from China," Policy Research Working Paper Series 1704, The World Bank.
  2. Hua Wang & Wheeler, David, 1996. "Pricing industrial pollution in China : an econometric analysis of the levy system," Policy Research Working Paper Series 1644, The World Bank.
  3. Dasgupta, Susmita & Huq, Minul & Wheeler, David & Chonghua Zhang, 1996. "Water pollution abatement by Chinese industry : cost estimates and policy implications," Policy Research Working Paper Series 1630, The World Bank.
  4. Dasgupta, Susmita & Hua Wang & Wheeler, David, 1997. "Surviving success : policy reform and the future of industrial pollution in China," Policy Research Working Paper Series 1856, The World Bank.
  5. Dasgupta, Susmita & Huq, Mainul & Wheeler, David, 1997. "Bending the rules : discretionary pollution control in China," Policy Research Working Paper Series 1761, The World Bank.
  6. Pargal, Sheoli & Wheeler, David, 1996. "Informal Regulation of Industrial Pollution in Developing Countries: Evidence from Indonesia," Journal of Political Economy, University of Chicago Press, vol. 104(6), pages 1314-27, December.
  7. Hettige, Hemamala & Huq, Mainul & Pargal, Sheoli & Wheeler, David, 1996. "Determinants of pollution abatement in developing countries: Evidence from South and Southeast Asia," World Development, Elsevier, vol. 24(12), pages 1891-1904, December.
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