The role of imports in reducing emissions: evidence from Chinese listed companies

Does international trade affect the environment while promoting economic growth? This question has received increasing attention in recent years. Previous research on the trade-environment relationship has mostly focused on the macro- and export levels. In this paper, we develop a theoretical model from a micro-perspective, creatively constructed a dataset of Chinese listed companies, and use the propensity score matching (PSM) method to conduct empirical tests to investigate the impact of companies' import behavior on environmental performance at the micro-level. Our study shows that companies that import intermediate goods are more environmentally friendly and validates the robustness of this result. Furthermore, we discuss the potential mechanisms that affect pollution emissions. This paper also has important policy implications that policymakers should consider reducing import tariffs on intermediate goods, thereby reducing import costs for enterprises and promoting green trade. Business owners should develop rational production strategies, strengthen technological innovation, establish social responsibility, and improve the environmental performance of their companies.