Research On Industrial Development & Environmental Economic Game In Chinese Town-village Enterprises

Chinese Town-village Enterprises (addressed TVEs) have been driven to grow at extraordinarily high levels since the Reform and Open Policy. The rapid growth in Chinese TVEs has accompanied by a wide range of deterioration to the environment and ecology. The survey from State Environmental Protection Administration of China (SEPA) and State Statistics Bureau in 2006 showed that there existed an economic loss of five hundred, eleven billion and eight million RMB dollar (511,800,000) incurred from environmental pollution in the whole country, of which over 50% came from Town-village industry. The environmental risk from Town-village industry has already become one of the most important factors to restrain our national sustainable development. Pollution problem from industrial growth presents the complexity of "Market Failure" and "Government Failure", and also the latter is more serious. The traditional public sector management appears inadequate to deal with the new challenge in environmental protection that emerges. In this case, the study on the institutional cause of environmental deterioration in Town-village industry and the approach to the Countermeasures of environmental protection in order to urge our economic growth sustainable, fast and stable, are brand meaningful. More than that, it is also very necessary and urgent for implementing the strategy of building a energy and resource-conserving, ecological and environment-friendly society and the formation of systems and mechanisms of sustainable development for industrialization instead of traditional industrial structure and increasing ways and consuming modes accordingly proposed by The 17th National Congress of the Communist Party of China (CPC), The strategy signals the Party's determination to promote more coordinated development based on social harmony, environmental protection and energy conservation in addition to economic expansion based on the Scientific Outlook on Development.The thesis focuses mainly on economical analysis of the polluting behavior in particular realm of Chinese Town-village industry, and the economical analysis of the polluting behavior concentrates on institutional structure, inter-players game, especially inter-local government economic game on be half of local interest through analyzing. The research tries to explore the dependent path of polluting treatment and the harmonious system of environmental economic operation based on the view of market. Institutional Economic, Incentive Theory, Game Theory and Externality, etc, will take great play in role of these issues.The thesis makes use of the method of Institutional Economic to analyze the formative reasons from the angle of restrained factors and the inter-players' game factors respectively, and to explores how both Macroeconomic polices of State and Microeconomic operating circumstance from firms affect the behavior's choice on the issue of environmental pollution and protection. The thesis takes this as foundation to study how to strengthen the functions of government regulating and economic incentive and to induce the marketing mechanism of environmental investment to public polices analysis of environmental economy, which provides Town-village industry with a series of new Countermeasures and suggestions of resolving pollution.First, analyzing from its owned restrictions, there are a lot of obstacles facing to resolving path of Town-village industrial pollution. These obstacles are basically divided into environmental capacity, incoming status, technique level, industrial structure and institutional binding, especially institutional binding is surely matter. Town-village industry locates in the circumstance such like diversification of property, economic and social structure control system dualism (between in urban and rural areas), dim trust relation between higher government and lower level one, shortage of economic scale, less developed economic system, economic social transformation, and backward environmental and economic polices, etc, those factors have taken disadvantageous influence on coordinating between Town-village industrial increasing and environmental protection.Second, analyzing from game, the thesis tries to go further into the economic cause of environmental problem. There are all kinds of non-cooperating game relations between local firm and local firm, local government and local firm, local government and local government, local government and Central government, and thus those have brought a series of problems, such as Government Failure, abusing resources and environment, etc, these problems are the examples of non-cooperation game in period of our nationaleconomic transformation. A sure result is the rapid increasing of industrial pollution and the deterioration of environment in TVEs. The thesis, through analyzing the interest allocating structure and assuming cost status among the players concerned under the background of economic growth and environmental protection by means of Property Theory and Game Theory, reveals the institutional features of restrain industrial environmental and economic operation run well and basic factors of restrain industrial environmental and economic institutional transformation inTVEs.Third, analyzing from bringing institutional incentive function into play. Different institutional structure presents different property structure, which make the public policy's maker face different opportunity cost and affect the public policy's maker choose preferred. In order to resolve our national Town-village industrial pollution, an economic incentive policy must be strengthen as well as government regulation control, such as Environmental Influence Appraisal System, 'Three In the Meantime (Design, Construct and Operating in the meantime)', Concentrating Pollution Treatment System . We need to urge Town-village industrial Park's construction and build environmental protection agencies at all levels and improve gradually execution through unifying a programming and making a reasonable layout leaded by the Scientific Outlook on Development. Considering of our backward in environmental and economic incentive institution, we should open up and clear up incentive resources and bring Government Regulation and Pigovian taxes into play to build a Coase Theorem Marketing Mechanism. Though it is found that each method of control has its strengths and weaknesses, economic incentive instruments will be efficient contributors to our national TVEs pollution treatment accompanying by regulation public administrative behavior.Without any doubts, we have put more special emphasis on environmental investment in urban industry rather than those in rural areas since long time, which leads to an amount of owing from the country. It appears that there are many factors to constrain environmental improving in TVEs, and a great shortage of national financing transfer to break rural and urban dualistic economic structure and to construct new socialist harmonious countryside, the mission of the infrastructure constructing in environmental investment is formidable. It has been proved that BOT is the availability means to solve the lack of capital by the fulfillment, so we should innovate environmental investment mechanism for example a BOT project-financing mode, and build a sound proper investing & financing system, for example a modern corporate governance structure, and a diversified polycentric mechanism on the basis of the Market mechanism as leading and Government mechanism as a promoting supplement timely, which have thrown brand new light on the environmental investment in TVES.