Environment Regulation And Foreign Direct Investment Inflow A Review Based On The Policy Of "Two Control Zones"

To a certain extent,Chinese huge development achievement is obtained at the cost of destroying the living environment.At the initial stage,due to the extensive domestic economic growth mode and large-scale use of energy and resources,the living environment has been destroyed,while the inflow of foreign capital into manufacturing and other fields has increased the environmental burden.In the 1980s-1990 s,some multinational companies in developed countries took China as a refuge for their transfer of pollution intensive enterprises and marginal industries.With the lack of environmental regulation,environmental policies and environmental governance level,China’s environmental form became more and more severe.The introduction and implementation of these policies have affected the total amount of foreign capital inflow."Two control areas" policy is one of many environmental control policies,mainly for air pollution.In order to verify the mechanism of the environmental control policy represented by the "two control zones",and how the policy affects the secondary industry in eastern China through FDI,this paper makes an empirical analysis.Combined with the double difference estimation method and the intermediary effect model,this paper specifically studies the impact of the "two control areas" environmental policy proposed in 1998 on foreign direct investment and the secondary industry in the eastern region.Based on the panel data of 251 prefecture level cities,we learned the “two control zones” policy has significantly reduced the FDI.and at the same time,there is a high proportion of foreign capital in China’s pollution intensive enterprises.