The Analysis Of Transference Of Pollution-Intensive Industries And The Countermeasures

With economy globalization and boom of international trade and investment, production factors flow frequently between countries, and the Pollution-intensive Industries are transferred from developed countries to developing countries. As the largest developing country in the world, China is likely receive much more Pollution-intensive Industries while the open policy get more and more efficiently performed. FDI seemed to be the most popular way for PII transference. Nowadays, we need badly the research of environment policy and coordinated mechanism to resolve the confliction between investment freedom and environment protection for purpose to coordinate the mutual benefit of the North and the South.Based on the Multi-country Corporation and the Nash bargaining model, the authors form a improved two side cooperative game model that give the reasons and inner logic of the variation of strategy of the MNC of developed countries to transfer polluted industry to China. With the restriction of the government of the host country and the limitation of the market level, the relative bargaining power of the two sides is the key factor to decide the MNC's strategy. If the cost of the polluted industry transfer is controlled under a certain level, the MNC prefers to extend the transfer of the polluted industry. With positive analysis respectively between the annual statistic of per capita GDP and waste discharge, and the annual statistic of per capita GDP which get rid of FDI impaction and waste discharge, the turning point of EKC shows a gentle decreasing tendency without the affection of FDI. It indicates that if FDI become the method for the developed countries to transfer their polluted industry to developing country, FDI will aggravate environmental damage in developing countries.The analysis of Scale Effect and Technique Effect shows both the negative and positive effection brought by FDI. The article make a further analysis on the Pollution haven hypothesis and test it in China. The author brings out effective ideas to coordinate the confliction between investment freedom and environment protection.