Border pollution reduction in China: The role of livestock environmental regulations

This paper studies the effect of environmental regulations on border pollution reduction in developing countries' rural areas by taking livestock environmental regulations (LERs) in China as a quasi-natural experiment. Applying the generalized difference-in-difference-in-differences (DDD) method, we find that LERs are effective in reducing border pollution: the chemical oxygen demand (COD) and ammonia nitrogen (NH3-N) of the border counties are 21.78% and 39.51%, less than that of the interior counties. We document that the effectiveness of LERs in reducing border pollution can be attributed to the fact that LERs require local governments to make collective decisions in fighting livestock pollution. Further heterogeneity analysis finds that the reduction effect of LERs on border pollution is greater in the downstream border and underdeveloped areas. Our paper implies that the externality of border pollution can be internalized through collective decision-making between local governments.

Automated summary

This study investigates the impact of environmental regulations on border pollution reduction in developing countries' rural areas, using livestock environmental regulations in China as a case study. The findings demonstrate that environmental regulations are effective in reducing border pollution, with a greater effect observed in downstream border areas and underdeveloped regions. This suggests that collective decision-making by local governments can help internalize the externality of border pollution.