Impact of Environmental Regulation on the Employment Effect of High-Tech Industries: Evidence from Spatial Durbin Model

Abstract

To address the challenges posed by the living environment and promote sustainable development, the Chinese government implemented a new environmental protection law in 2015. Based on the provincial panel data of 30 provinces, autonomous regions, and municipalities in China from 2010 to 2019, the spatial Durbin model is used to investigate the impact of environmental regulation on the employment effect of high-tech industries, and the spatial effect decomposition is used to further clarify the specific impact of environmental regulation on the employment of high-tech industries. The research finds that: Firstly, at the present stage, environmental regulation in China remains at a relatively low level. The employment generation effect of environmental regulation on high-tech industries is insufficient to offset the employment loss effect. Strengthening environmental regulation in the short term is unfavorable for employment in high-tech industries. Secondly, adjacent regions adopt a strategy of competitive differential environmental regulation between governments. The local government relaxes environmental regulation to increase employment, while the neighboring government strengthens environmental regulation to promote industrial upgrading. This approach benefits local employment in high-tech industries in the short term but hinders the sustainable development of high-tech industries. Thirdly, environmental regulation exhibits significant negative spatial spillover effects. Strengthening local environmental regulation will suppress the growth of high-tech industry employment in neighboring areas, and the spatial spillover effect of environmental regulation is primarily influenced by geographic location.