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Financial development and environmental performance: evidence from China*

Published online by Cambridge University Press:  02 November 2010

KARL YUXIANG  and
ZHONGCHANG CHEN
KARL YUXIANG
Affiliation:
School of Public Administration, School of Public Administration, and School of Economics and Business Administration, Chongqing University and Chongqing College of Public Administration, Tian Xia Cheng 5-7-2, Panxi 6th Road, Jiangbei District, Chongqing 400020, China. Tel: +861-8702 32-3992. Email: karlyuxiang@139.com, karlyuxiang@sina.com
ZHONGCHANG CHEN
Affiliation:
School of Public Administration, Chongqing University, Sha Zheng Street 174, Shapingba District, Chongqing 400044, China
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Abstract

This paper extends the debate on the environmental performance of developing countries by focusing on a new factor. Theoretically, financial development has capitalization, technology, income, and regulation effects on the environment. Using the provincial panel data of China, the econometric analysis provides some evidence of a linkage between financial development and industrial pollution discharges. In recent years, the environmental performance of China has been significantly improved by financial development and some environmental protection schemes. This relationship offers new implications for policy makers in developing countries.

Information

Type
Research Article
Information
Environment and Development Economics , Volume 16 , Issue 1 , February 2011 , pp. 93 - 111
Copyright
Copyright © Cambridge University Press 2010

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