Journal
CHINA ECONOMIC REVIEW
Volume 69, Issue -, Pages -Publisher
ELSEVIER SCIENCE INC
DOI: 10.1016/j.chieco.2021.101659
Keywords
Air pollution; Bunching estimator; Information disclosure; Regression discontinuity design; Political incentives
Categories
Funding
- Major Project of National Social Science Foundation of China [21ZDA010]
- Key Project of Soft Science Research Plan of Zhejiang Science and Technology Program [2019C25029]
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This study identifies the distortion in government disclosure on air pollution and attributes it to the promotion incentives of local politicians. It also shows that high-frequency disclosure requirements can effectively discipline local government behaviors.
This study investigates the distortion of government disclosure on air pollution and further explores underlying political incentives that drive such distortion. We introduce a newly developed method, that is, bunching estimation based on notch points, to identify the distortion in the air pollution index disclosed by local governments. Results show that the magnitudes of distortion are significant and vary across cities. We present evidence that local politicians' promotion incentives substantially drive the distortion of environmental information. Importantly, we find that high-frequency disclosure requirements effectively discipline the behaviors of local governments because of increased manipulation costs. Overall, we contribute to the literature by identifying the distortion of government information disclosure, investigating the underlying causes, and examining the validity of new disclosure policies in shaping government behaviors.
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