Based on the inter-provincial panel data from 2000 to 2014 in China, this paper applies the spatial panel simultaneousequations model to test the impact of local governments’ tax competition and industrial structure adjustment on the regional green development in China. The conclusions are as follows. Local governments’ tax competition and industrial development have a negative impact on green development. Tax competition and industrialization in the neighboring regions will also suppress local green development through the negative incentives of “race to the bottom”. Evidently, regulating the tax competition behavior of the local government and rationally guiding the upgrading of local industrial structure have important policy implications for the high-quality growth of China’s regional economy and the green, coordinated development between regions in the new era.
Keywords: local governments’ tax competition, industrial structure adjustment, regional green development
China Finance and Economic Review
Volume 8 Number 1 Spring 2019.P93