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Incomplete enforcement of pollution regulation : bargaining power of Chinese factories


  • Wang,Hua*Mamingi, Nlandu*Laplante, Benoit*Dasgup


Only a small number of studies have empirically examined the determinants of the monitoring and enforcement performed by environmental regulators, and most of these have focused on industrial countries. In contrast, the authors empirically examine the determinants of enforcement in China. More precisely, they analyze the determinants of firms'relative bargaining power with local environmental authorities with respect to the enforcement of pollution charges. The authors show that private sector firms appear to have less bargaining power than state-owned enterprises. Contrary to earlier findings, they also show that firms facing adverse financial situations have more bargaining power than other firms and are more likely to pay smaller pollution charges than they should be paying. Finally, the authors show that the greater the social impact of a firm's emissions (as measured by complaints), the less bargaining power it has with local environmental authorities.

Suggested Citation

  • Wang,Hua*Mamingi, Nlandu*Laplante, Benoit*Dasgup, 2002. "Incomplete enforcement of pollution regulation : bargaining power of Chinese factories," Policy Research Working Paper Series 2756, The World Bank.
  • Handle: RePEc:wbk:wbrwps:2756

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    References listed on IDEAS

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    2. Porter, Richard C., 1988. "Environmental negotiation: Its potential and its economic efficiency," Journal of Environmental Economics and Management, Elsevier, vol. 15(2), pages 129-142, June.
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    14. Gray, Wayne B. & Deily, Mary E., 1996. "Compliance and Enforcement: Air Pollution Regulation in the U.S. Steel Industry," Journal of Environmental Economics and Management, Elsevier, vol. 31(1), pages 96-111, July.
    15. Dasgupta, Susmita & Laplante, Benoit & Mamingi, Nlandu & Wang, Hua, 2001. "Inspections, pollution prices, and environmental performance: evidence from China," Ecological Economics, Elsevier, vol. 36(3), pages 487-498, March.
    16. 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.
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