The Impact of Environmental Regulation on the Upgrading of Urban Industrial Structure: A Quasi-Natural Experiment Based on the Two Control Zones Policy

Abstract

This paper considers the two control zones policy implemented in 1998 in China as a quasi-natural experiment, examines the impact of environmental regulation on the upgrading of urban industrial structure by constructing a DID model, and tests the heterogeneity of its role at the regional and urban levels. Results have found that: (1) From a national perspective, the two control zones policy has significantly promoted the upgrading of urban industrial structure. In addition, from the perspective of different control zones, the two control zones policy has a positive promoting effect on the upgrading of industrial structure. (2) The two control zones policy has significant long-term effects in promoting industrial structure upgrading, and its impact on industrial structure upgrading shows dynamic effects. (3) The industrial structure upgrading effect of the two control zones policy exhibits significant heterogeneity across different city scales. (4) In terms of regions, the two control zones policy has significant spatial heterogeneity.