International Journal of Earth Sciences and Engineering

Hong-Xin Yu ¹, Yuan-Jun Zhao ²

Affiliations
1 International Business Administration, Shanghai University of Finance and Economics, Shanghai-200433, CN
2 Glorious Sun School of Business and Management, Donghua University, Shanghai-200051, CN

Abstract

There are three motivating factors behind the government's action:tax incentive, official's promotion incentive and direct economic interests. China's provincial panel data of 1997-2013 shows that tax incentive and official's promotion incentive have a positive impact on the environmental conditioning, while direct economic interests, that are official corruption, will increase environmental problems. Obviously, it is not the same that different incentive factors have an impact on the environment. At the same time, foreign direct investment is surely responsible for the environmental pollution problem in China. A good institutional environment is beneficial to reduce the negative impact of foreign direct investment and official corruption on the environmental pollution. To improve the quality of environment, it needs to establish a good government internal institutional environment and effectively curb corruption; meanwhile to improve the market external institutional environment.

Keywords

Tax Incentive, Official Promotion, Official Corruption, Environmental Pollution, Foreign Direct Investment, Internal Institutional Environment, External Institutional Environment.

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