ArticleInternational journal of environmental research and public health2022
Does Environmental Regulation Help Mitigate Factor Misallocation?-Theoretical Simulations Based on a Dynamic General Equilibrium Model and the Perspective of TFP.
Article in International journal of environmental research and public health, 2022. The graph could read no effect estimate from its abstract, so it casts no vote on the map. Cited by 4 papers.
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4 citing papers in PubMed.
- The Sustainability of the Fishery Industry and Environmental Development: A Study on Factor Market Distortions.International journal of environmental research and public health · 2023Article
- Environmental Regulation, Resource Misallocation, and Total Factor Productivity: An Empirical Analysis Based on 284 Cities at the Prefecture-Level and Above in China.International journal of environmental research and public health · 2023Article
- The econometric analysis of voluntary environmental regulations and total factor productivity in agribusiness under digitization.PloS one · 2023Article
- Spatial Differences and Influential Factors of Urban Carbon Emissions in China under the Target of Carbon Neutrality.International journal of environmental research and public health · 2022Article
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Authors and funding
5 authors.
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Abstract
How environmental regulation affects factor allocation is becoming an emerging hot topic in academia. In this paper, we construct a dynamic general equilibrium model accommodating environmental regulatory shock based on the H-K framework to explain the impact of environmental regulation on factor misallocation from the perspective of aggregate total factor productivity loss changes, and numerical simulation results are provided for several representative scenarios. The results show that environmental regulation has a significant effect on factor market misallocation, but this effect is not simply positive or negative, and it mainly depends on the firms' initial factor allocation status and the intensity of the shock. Reducing the intensity of environmental regulation for firms that face stronger distortion helps mitigate factor misallocation and, on the contrary, the same policy could exacerbate factor market misallocation. Under the environmental regulatory shock condition, firms' overhead labor input has a moderating effect on the factor allocation mitigation of environmental regulation. Distorted firms' higher overhead labor share inhibits the correction of factor misallocation by environmental regulation. And reducing firms' overhead labor share amplifies the correcting effect of environmental regulation on factor misallocation.
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