Policy mix or policy mess? Impacts of policies on the productive efficiency of the Chinese wind power industry

Abstract

Grand societal challenges call for a sustainability transition away from a fossil-based society toward a low-carbon society. Wind power is highly valued in China, owing to its strong environmental benefits and abundant reserves. Although accelerating the development of wind power industry is near the top of the agenda of the Chinese government, the impact of policies and their mixes on the productive efficiency of the wind power industry is still unclear. In this study, the productive efficiency of the Chinese wind power industry is systematically evaluated using microdata of 119 listed enterprises from 2006 to 2019. The effects of wind power policies and their mixes on the productive efficiency are then elucidated. The empirical results imply that the overall productive efficiency of the Chinese wind power industry is relatively high but that it fluctuated greatly between 2006 and 2019. Moreover, the effects of Chinese wind power policies and their mixes on productive efficiency are ambiguous. Both economic policy (EP) and regulatory policy (RP) hinder productive efficiency; only soft policy (SP) has a significant positive effect. Furthermore, the policy mixes of EP and RP, EP and SP, and RP and SP have no significant impact, but the policy mix of EP, RP, and SP significantly inhibits the productive efficiency of the Chinese wind power industry, indicating conflictive effects and confusion in the policy mix.