Search

The Poyang Lake Eco-Economics Zone is a national zone that has been approved by State Council as part of China's national strategy for sustainable development in the largest lake area since 2009. In this study, we aim to examine its sustainability characteristics, including environmental efficiency, the shadow price of pollutants, and substitutability among inputs and outputs, so that to improve the environmental regulation in this area. For this purpose, we use the global non-radial directional distance function and its duality theory. By using the envelope model, the environmental efficiency indicator can be calculated. By employing the dual model of the non-radial directional distance function, the shadow prices and Morishima elasticities of substitution among inputs and outputs can be derived. We use the proposed method to conduct an empirical study of the Poyang Lake Eco-Economics Zone at the prefecture-level during the period from 2009 to 2013. Results show that many regions in the Poyang Lake Eco-Economics Zone are not performing well on environmental efficiency and have potential to improve by 31.9% on average. Meanwhile, the waste water has much lower shadow prices than the either sulfur dioxide or soot. On the other hand, with regard to the shadow prices of soot emission, approximately one-third of these regions were not charged anything for disposing soot emissions at any time of day or night during the 2009–2013 periods. Moreover, these 38 regions show energy-intensive as well as labor-intensive features. Finally, this paper also discusses the policy implications, including establishing the pollutant emissions trading system in China as well as encourage the technology innovation for energy saving and emission reduction. [ABSTRACT FROM AUTHOR]