What Hinders the Promotion of the Green Mining Mode in China? A Game-Theoretical Analysis of Local Government and Metal Mining Companies

Abstract

China is currently trying to reduce the environmental impact of metal mining operations by promoting green mining. However, conflicts of interest between the central government, local governments, and metal mining companies often negatively affect the implementation of related policies. This paper conducted a theoretical analysis of the game mechanism between local governments and metal mining companies to study the factors that influence their strategies. First, we summarize the various game model parameters, determine the strategies which the companies and local government can choose, and establish the game model for the companies and the local government. Second, we list the utility of the company and local government under all game outcomes and analyse their behavioral tendencies. Third, we discuss the impacts of various factors on the choice of their mining mode in detail. The behavioral analysis shows that the local government’s inclination to supervise a mine is negatively related to the supervision cost and positively related to the production scale of this mine; various factors influence the companies in their decision making, with the yield and comprehensive utilization rate of tailings and waste rocks have the greatest impact; the scale of mine production also affects the companies’ willingness to carry out technological innovation. Finally, we offer some suggestions for the promotion of green mining.