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Booster or barrier? Can ecological accountability system reform inhibit environmental violations? Evidence from quasi-natural experiment

Author

Listed:
  • Sheng Liu

    (Guangdong University of Foreign Studies)

  • Hongyi Zou

    (Guangdong University of Foreign Studies)

  • Xiuying Chen

    (Guangdong University of Finance)

Abstract

Environmental protection supervision is an important manifestation of ecological accountability system reform. Taking the implementation of China’s central environmental protection inspection (CEPI) policy as a quasi-natural experiment, this paper applies the time-varying difference-in-difference (DID) model to identify the impact of the CEPI policy on the likelihood of enterprises’ environmental violations. The main conclusions include: (1) the implementation of CEPI policy is conducive to inhibiting environmental violations. After a series of robustness tests, including the parallel trend test, the placebo test, the exclusion of policy interference, and the replacement of explained variables, the result remains robust. In terms of dynamic perspective, there is a lag in the impact of CEPI policy on enterprises’ environmental violations. (2) The effect of CEPI policy is more prominent on samples of large enterprises, enterprises with highly concentrated equity, enterprises that polluted heavily, enterprises owned by executives with a political background, and enterprises that are situated in regions with higher level of marketization and more developed information infrastructure. (3) The CEPI policy can restrain the environmental violations of enterprises by a dual mechanism of releasing punishment and deterrence signals from the external governance, and forcing enterprises to enhance environmental management system from the internal governance.

Suggested Citation

  • Sheng Liu & Hongyi Zou & Xiuying Chen, 2024. "Booster or barrier? Can ecological accountability system reform inhibit environmental violations? Evidence from quasi-natural experiment," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(5), pages 11703-11727, May.
    • Handle: RePEc:spr:endesu:v:26:y:2024:i:5:d:10.1007_s10668-023-03457-w
    DOI: 10.1007/s10668-023-03457-w
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