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Hosted by the Program on Chinese Cities (PCC)

02/29/2024 3:00 PM-4:00 PM

Presenter: Hongli Yang

Professor of Shanghai Lixin University of Accounting and Finance

Sponsored by the 2020 Shanghai Pujiang Program

Sponsored by 2023 Shanghai Eastern Talent Plan Leading Project

Principal investigator for 2 projects from the National Natural Science Foundation of China, 2 projects from the Ministry of Education, and multiple projects from the Shanghai Government.

Visiting Scholar, Duke University -Supervisor: Prof. Daniel Yi Xu

Visiting scholar, University of North Carolina at Chapel Hill -Supervisor: Prof. Yan Song


Based on the database of foreign-owned parent subsidiaries in China, we utilize changes in the policy combination of environmental legal regulation and environmental information disclosure to construct a quasi-natural experiment. It confirms that these two policies must be strengthened simultaneously to effectively restrain the establishment of polluting foreign-owned subsidiaries while increasing the number of clean foreign-owned subsidiaries. The research also reveals that clean foreign-owned parent companies are more significantly influenced by environmental regulations and serve as the primary source of the incremental growth of clean foreign reinvestment. We also found that environmental regulation policies formulated by the central government play a decisive role in environmental governance. However, the efforts invested by local governments in the environmental governance process also contribute to enhancing the effectiveness of environmental governance. The conclusions drawn in this paper imply that environmental pollution control does not necessarily conflict with stabilizing foreign investment. To achieve environmental governance goals, there is a need to prioritize both the development of environmental legal regulation and information disclosure systems.


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