Research On The Green Development Effect Of Vertical Ecological Compensation

While the industrial revolution has brought great wealth and convenient lifestyles to mankind,it has also brought great challenges to human survival.The "Rhine pollution incident" in Switzerland in the late 20 th century,etc.,all show the great damage caused by industrialization to the ecological environment and human health.In China,during the period after the reform and opening up,the GDP growth-oriented economic development strategy was implemented and great achievements were made.However,with the large-scale promotion of industrialization and urbanization,environmental pollution and ecological damage also showed a rapid increase,such as the major water pollution incident of Songhua River,the dead fish incident of Baiyangdian in Hebei,and the arsenic pollution incident of Yangzonghai in Yunnan,etc.,all illustrate the increasingly prominent environmental problems in China and the heavy environmental price paid by industrial development.After2003,China gradually changed its economic development approach of simply pursuing GDP growth,and paid more and more attention to the management of ecological environment.In terms of development strategy,from the 11 th Five-Year Plan to the 14 th Five-Year Plan,the weight of ecological and environmental protection indicators has been continuously increased to strengthen the requirements of ecological civilization construction.In the 14 th Five-Year Plan and the 2035 Vision,further emphasis has been placed on promoting green development and facilitating the overall green transformation of economic and social development.In terms of policy,a series of initiatives have been introduced to strengthen ecological protection,from the "double control zone" policy to the construction of a carbon emission trading system,and so on.Accordingly,in the field of financial activities,more and more funds are invested in ecological protection and management,among which vertical ecological compensation has become the main financial tool for ecological protection and management in China.This thesis takes vertical ecological compensation as the research object,evaluates the green development effects of vertical ecological compensation in terms of policy and fund scale,and explores the behavioral choices of local governments under the incentive of vertical ecological compensation.To this end,based on the research idea of "theoretical mechanism-factual characteristics-empirical evaluation-policy suggestions",this thesis focuses on four aspects based on existing research.First of all,it compares relevant domestic and foreign literature,and establishes a theoretical analysis framework of vertical ecological compensation affecting green development based on theories related to vertical ecological compensation and green development.Secondly,we review the evolution of vertical ecological compensation in terms of compensation fields and compensation fund investment,analyze the current status of implementation of vertical ecological compensation policies in different environmental fields,and describe the characteristics of unbalanced green development in China.Thirdly,based on green development theory,we measure green development in three dimensions: ecological environment,economic development and social welfare,and evaluate the ecological environment effect,economic development effect and social welfare effect of typical vertical ecological compensation policies based on national county-level data using propensity score matching and double difference methods,respectively;identify vertical ecological compensation policies under balanced transfer payments from the provincial level using a two-way fixed-effect model Fourth,based on the main findings,we identify the effects of vertical ecological compensation funds on the ecological environment,economic development,and social welfare at the provincial level.Finally,based on the main findings,we propose policy recommendations for optimizing China’s vertical ecological compensation system from the perspective of green development.Through the above four aspects of research,this thesis draws the following four main conclusions.First,the current vertical ecological compensation is conducive to improving the quality of ecological environment.With the incentive of vertical ecological compensation funds,the vertical ecological compensation policy has effectively improved the ecological and environmental protection efforts of local governments,resulting in significant improvements in both ecological and environmental quality in national key ecological function areas and counties,and significantly increasing the probability that the overall ecological and environmental quality will become better,especially in areas with low levels of economic development and areas with strong incentives for promotion of local principal officials.Overall,vertical ecological compensation funds from the central government to localities compensate local governments for the opportunity cost of sacrificing economic development,thus making local governments willing to achieve ecological and environmental quality improvements by limiting industrial development and investing vertical ecological compensation funds in poverty alleviation projects to improve rural residents’ income and reduce social resistance to ecological and environmental protection.In addition,the policy effect of vertical ecological compensation to improve ecological environment quality has a positive spillover effect on other non-ecological functional counties that are in the same prefecture-level city as the ecological functional counties.Second,the current vertical ecological compensation policy is to a certain extent inhibitory to economic level improvement.After the implementation of the vertical ecological compensation policy,local governments restrict the industrial development of the region and reduce the number of industrial enterprises above the scale in their jurisdictions in order to improve the quality of ecological environment,thus reducing the level of regional economic development.Third,the current vertical ecological compensation policy has a certain negative impact on the supply of basic public services,but has a positive impact on the per capita disposable income of rural residents.After the implementation of the vertical ecological compensation policy,local governments are more inclined to invest vertical ecological compensation funds in ecological environment and poverty management,leading to a crowding-out effect on basic public services and a decrease in the level of basic public service supply.Meanwhile,the vertical ecological compensation policy mainly raises the per capita disposable income of rural residents through two paths: first,central to local vertical ecological compensation funds.The vertical ecological compensation funds under the balanced transfer can both directly increase the income of ecological rangers and increase local livelihood expenditures,especially agriculture,forestry and water expenditures,and thus increase the per capita disposable income of rural residents.Second,the vertical ecological compensation policy stimulates local governments to limit industrial development,shift from developing the secondary industry to improving the primary industry,increase the total output value of agriculture,forestry,animal husbandry and fishery,and thus increase the per capita disposable income of rural residents.Fourth,in general,local governments in key ecological regions continue to face multiple development contradictions in ecological environmental protection,economic development and social welfare;locally,vertical ecological compensation policies have produced differentiated effects in different regions.From the national average: when facing environmental constraints in key ecological function counties,local governments spend limited financial resources on ecological environment improvement and poverty management by sacrificing economic development and reducing the supply of basic public services.From a local perspective: First,the vertical ecological compensation policy has created an "incentive distortion" effect in areas under greater financial pressure.After the policy was implemented,key ecological function areas and counties under greater financial pressure only improved ecological quality,but not environmental quality,while the level of basic public service provision decreased and the economic level increased.The empirical results show that the greater the financial pressure,the stronger the incentive for industrial development,which in turn leads to environmental degradation and further crowding out of basic public service inputs,resulting in a greater decline in the level of basic public service supply,and ultimately only improving ecological quality,while the economic level rises.Second,the vertical ecological compensation policy is not sufficiently incentivized in areas with higher levels of economic development.After the policy was implemented,the comprehensive ecological quality in areas with higher levels of economic development did not improve.The reason for these two differential effects is that the vertical ecological compensation funds received by these regions are not enough to cover their opportunity costs arising from ecological protection,leading to strategic behavior of local governments in the face of environmental constraints.In addition,the poverty governance effect of vertical ecological compensation policy occurs differently in regions with different levels of economic development,regions with different financial pressures,regions with different distances from provincial capitals,and regions with different ecological and environmental conditions.The higher the level of economic development,the worse the effect of increasing rural residents’ income;the higher the financial pressure,the better the effect of increasing rural residents’ income;the closer the national key ecological function counties to the provincial capital cities,the less the effect of increasing rural residents’ per capita disposable income,while the more distant the national key ecological function counties from the provincial capital cities,the more obvious the effect of increasing income;the better the ecological environment status or the more obvious the improvement.The better the ecological environment or the more obvious the improvement,the stronger the effect of increasing the income of rural residents in counties with national key ecological functions.Based on the above research findings,this thesis puts forward policy recommendations for optimizing China’s vertical ecological compensation system from the perspective of green development,which are divided into the following four aspects: first,establishing a differentiated vertical ecological compensation system.For key ecological regions with different economic endowments and natural endowments,differentiated ecological compensation standards need to be constructed;for key ecological regions and non-key ecological regions,a green GDP assessment system for key ecological regions needs to be established.Second,promote the transformation of ecological value to economic value.Guide local governments to develop ecologically advantageous industries and improve the mechanism for realizing the value of ecological products,so as to promote the transformation of ecological advantages of key ecological regions into economic advantages.Third,improve the supporting system of vertical ecological compensation.By improving the horizontal ecological compensation system and perfecting the market-oriented construction of ecological compensation,a diversified and market-oriented comprehensive ecological compensation system with organic combination of vertical and horizontal can be formed.Fourth,strengthen the top-level design of ecological compensation system.Accelerate the introduction of the Ecological Compensation Regulations and technical guidelines for accounting of ecological compensation standards,and clarify the affairs and expenditure responsibilities in the field of ecology and environment,so that vertical ecological compensation can be based on law.