Search

In the process of pursuing a Chinese path to modernization that advocates the promotion of harmony between humanity and nature, dealing with the synergy of multi-target environmental regulation policies is an important task towards the modernization of China's governance system and capacity. In this context, can synergistic environmental policies more effectively promote industrial transformation and upgrading when facing the two strategic tasks of building a beautiful China and achieving the goals of reaching peak carbon emissions and carbon neutrality? Existing research has no answer to this question. This study used the policy of establishing ' acid rain and SO2 pollution control zones' and the low-carbon city pilot policy as a quasi-natural experiment of environmental policy synergy and combined the influences of the effective government and the efficient market within a unified analytical framework. Using the panel data of 282 prefecture level cities and above in China from 2003 to 2020, this study used the difference-in-differences model to examine the impact of the constraints of the dual environmental objectives, i.e., pollution control and carbon reduction, on the transformation and upgrading of regional industries. The results showed that: (J) Comparing with a single environmental regulation, the synergistic effects of the pollution control and carbon reduction policies were better at promoting regional industrial transformation and upgrading, and the conclusion consistently held through a series of robustness tests. © The mechanism analysis showed that under the dual environmental objectives, the effective government could stimulate regional industrial transformation and upgrading via the regulatory effect of fiscal expenditure. Simultaneously, the efficient market could motivate micro-enterprises to generate relocation and innovative compensatory effects to realize the transformation and upgrading of regional industries. Further research revealed distinct heterogeneity in the transformation and upgrading of regional industries under the dual environmental objectives. The zones with the two pilot policies had a more pronounced impact on the industrial transformation and upgrading of eastern regions, non-traditional industrial bases, regions with heightened environmental consciousness, and areas with superior environmental infrastructure. This study suggests that: ( Local governments should coordinate the overall situation and avoid the blind development of energy-intensive and highly polluting projects. © They should maximize the financial sector's role as a mainstay, attracting and directing more social capital towards green and low-carbon industries. © They should divide and implement national targets for reducing pollution and carbon emissions based on local conditions, and explore experiences and models that can be popularized and replicated. ® They should increase innovation incentives to encourage the synergy of low-carbon technology and low-pollution emission control technology. ® They should also deploy tailored policies that cater to specific regional conditions, foster the profound integration of regional resources, and maximize the potential advantages of each region's synergistic development in pollution control and carbon reduction. [ABSTRACT FROM AUTHOR]