Abstract

     This paper aims to provide a bibliometric analysis of green supply chain management in platform economy (GSCM-PE) literature. Based on the bibliometric approach, a descriptive analysis is engaged in the literature published from 2003 to 2020 in Web of Science. There are 1404 publications in this field of GSCM-PE. The number of publications has increased steadily since 2013. China is an essential contributor to this field, with the largest number of publications (356), followed by the USA (175) and England (116). However, China’s total citation is 0.5 times that of the USA, which indicates that China needs further strengthened in quality. In addition, the cooperation between European and American countries is relatively active. Six clusters are identified from co-word network, and their main conclusions are as follows: (i) based on Internet technology, the application of SCM in business is the hottest topic and (ii) network risk and security requires further exploration.

Introduction

     Supply chain management (SCM) is a comprehensive and effective management method from purchasing to meeting the end customer of the supply chain, which aims to optimise the operation with minimum cost. With people gradually raising the awareness of environmental protection, SCM has become environmentally proactive in recent years, and then the role of the supply chain in promoting recycling, reuse, and resource reduction has increased (Paulraj 2011). Therefore, the sustainable characteristic in supply chain management has been interested in scholars all over the world (Mariadoss et al. 2016; Mardani et al. 2020; Lee et al. 2020). Within this status quo, the SCM has been recently connected with the platform economy, which has an important carrier of supply chain management innovation (Brettel et al. 2014). The platform economy is a new economic system based on digital technology, which has gained momentum as the core organisational form of informational transformation. In the recent two decades, the platform economy has been highly applied in various industries, such as commercial transactions, financial intermediation and ride sharing (You 2020). Behemoth digital platforms economy such as Tmall.com and JD.com has a continuously ignited capital market with the method of SCM, enterprise value and so on.

Conclusion and discussion

     Green supply chain management has become the most concerned issue all over the world. With the practice of platform economy in some specific field, the research of combining platform economy and green supply chain management is a novel emerging area in recent years, which pays attention to interested researchers. In the paper, a total of 1404 papers about green SCM in the platform are collected in Web of Science, and the bibliometric analysis and network analysis are carried out by R and VOSviewers, respectively.

     This research shows that, in terms of the number of publications, the study level of the application of supply chain management in the platform economy is constantly improving. Moreover, since 2003, the total citations has increased significantly. The author analysis shows that Zhong is the most influential author in this field on the basis of the DF value. Besides, China is an essential contributor to the literature of supply chain management in the platform economy, with the largest number of publications (356), followed by the USA (175) and England (116). However, China’s total citation is 0.5 times that of the USA, which indicates that the influence of China in this field may have room for further development.

Abstract

     It is important to unearth the role of structural change factors for sustainable growth in developed economies. Economic complexity, export product quality, and institutional indicators represent the overall structural change and transformation in an economy. This paper probed the influence of export product quality and economics of complexity on economic growth for 28 OECD (Organization for Economic Co-operation and Development) countries using the data from 1990 to 2019. In doing so, the study employs three-panel data econometric models to investigate the role of economic complexity, export quality, and institutional quality on economic development. The paper performs the empirical tests, including the cross-sectional related dependency methods and cointegration techniques. As per the results emerging from fully modified OLS (FMOLS) and dynamic OLS (DOLS) estimation, export quality and financial development positively and significantly strongly impact growth in the long run. The empirical conclusions report detailed discussion on sustainable growth and discuss novel implications concerning product quality and institutional performance. The conclusions stress the practical implications for sustainable economic growth of OECD economies.

Introduction

     Over the last decade, there has been rising research in describing and analyzing countries’ productive structures. New measures of the economic complexity index have been developed to determine the sophisticating nature of the procedure of production making and gains from trade. According to Hidalgo and Hausmann (2009), the economic complexity helps to analyze countries’ productive capacities and the product quality of exports. Since they are more effective in estimating economic growth than traditional predictors, like GDP per capita, they are now widely used (Hausmann et al., 2014). Economic complexity occurs in a country if it can produce diversified products and export products have a more complex production structure. More specifically, economic complexity is the expanse of productive knowledge a country possesses that impacts economic performance. According to Lapatinas et al. (2019), it has been observed empirically that countries with higher complexity tend to gain additionally from trade and have a high degree of trade openness. Countries with advanced levels of economic-based complexity have higher economic capabilities since they utilize more intensive technology and high skilled labor (Hartmann et al., 2017).

Concluding remarks and implications

     International trade and industrial activities are conducive to the economic development of emerging and developed economies. However, the bolster economic objectives come with the repercussions of environmental externalities and structural transformation challenges. The on-hand research study is an effort to examine the heterogeneous impacts of structural change and institutional quality on economic growth. In doing so, the current study draws novel conclusions and implications regarding the sustainable development goals and sustainable growth in developed economies. This research attempted to explore the nexus among economic growth, economic complexity, export quality, financial development, human capital, renewable energy, and institutional quality for 28 OECD economies. In doing so, the study employed the annual data from 1990 to 2019 and tested three model specifications using extensive empirical analysis such as cross-sectional dependency tests by Pesaran (2015), Westerlund cointegration tests, and Pedroni cointegration tests, FMOLS, and DOLS.

     The empirical results highlight that greener and renewable energy have an important role to play for industrial activities, economic development and it can act as an alternative to achieve sustainable economic growth. Export quality leads to strengthening the trade by improving the quality of products, ultimately it can lead towards the economic progress of countries. Further, it can be interpreted that overall economic complexity encompasses financial development and product complexity, both of which are conducive for the growth of the economy.

Abstract

     Investors commonly rely on macroeconomic variables to drive capital allocation decisions. But other institutional factors may alter investor returns as well, particularly in emerging market countries. Given these concerns, this paper examines the effects of institutional factors—specifically democracy, transparency and corruption—on emerging market equity returns and flows. We find that institutional quality impacts stock market returns and flows in emerging markets where corruption, transparency, and democracy levels are below average. We also find that government-owned or controlled industries are positively impacted by a deterioration in the corruption and democracy indexes, while highly concentrated sectors, like the financial industry, are negatively impacted by improving transparency.

Introduction

     Investors often rely on macroeconomic factors (e.g., inflation, GDP growth) to drive allocation decisions (Ahlquist, 2006). But a burgeoning body of research suggests that investors should couple macroeconomic factors with market-specific institutional factors such as corruption when deciding where to allocate their capital across international markets. Institutional quality varies significantly across emerging market (EM) countries and within EM countries over time presenting an opportunity to explore the impact of institutional quality on EM stock market performance. As such, this paper examines if, and when, institutional quality impacts investor equity (i.e., stocks) returns and flows in emerging markets. Additionally, we assess if institutional quality has differential effects on investor equity returns in specific EM industries.

     The three institutional factors we focus on are: democracy, transparency, and corruption. The quality of these factors can affect market performance because they impact the reliability of the data in which investors rely upon to allocate capital. In addition, institutional quality can influence the cost of doing business, and affect the stability of markets.1 But how do each of these three institutional factors affect stock market performance in emerging markets.

Conclusions

     This paper examines the effect that varying levels of institutional quality regarding corruption, transparency, and democracy has on annual equity returns, flows, and industry returns in EM countries over an 18-year period. We find that an increasing level of transparency has a positive, significant impact on average annual market returns in each of the below median group of countries relative to corruption, transparency, and democracy. This result suggests that for emerging market countries where corruption, transparency, or democracy are poor, policies that improve transparency will have a positive impact on market returns.

     In addition, changes in institutional indices impact several EM industry returns. Specifically, we see higher democracy scores result in lower returns in the utility, oil and gas, and technology industries, while higher scores for corruption result in lower returns for the consumer services and utility industries. The commonality between these industries is that they have a high level of government ownership or management, particularly in emerging market countries, or are highly concentrated industries. Finally, we see higher corruption scores result in lower net equity flows, a result that may be driven by FDI into China. Less surprising is the finding that net equity flows are positively impacted by an increase in the democracy index in countries with below median democracy and transparency scores.

1- Introduction

2- The model

3- Productive public expenditures

4- Other features

5- Conclusions

References

Abstract

Empirical evidence suggests that low-income countries are characterized by high levels of labor and capital income tax evasion while the opposite is true for high-income countries. This paper proposes a model to study the relationship between economic growth and both types of income tax evasion. We show that the existence of a social norm towards tax compliance generates a complementarity between capital and labor income tax evasion which explains the decline of both the share of evaders in the population and the amount of tax evasion when countries accumulate capital. The model predicts that the level of tax morale is positively correlated with both types of income tax evasion and the level of income per capita, consistent with recent empirical evidence. Finally, a higher tax rate increases the share of evaders in the population and aggregate tax evasion.

Introduction

Tax evasion not only harms the possibility of governments to obtain public revenues and, thus, to finance public programs; tax evasion is also negatively related to economic performance. In a recent survey, Vasilopoulou and Thomakos (2017) provide evidence about a strong negative relationship between economic growth and tax evasion. Similarly, Schneider et al. (2011) and Crane and Nourzad (1986) find that the relative size of the shadow economy (and tax evasion) have decreased over time for a wide sample of countries whereas GDP per capita has increased. Besley and Persson (2014) and Gordon and Lee (2005) show that for similar tax rates high-income countries obtain much higher levels of tax revenue than low-income countries, suggesting that tax evasion is a severer problem in low-income countries. Moreover, empirical findings suggest that tax evasion is a widespread problem, especially in developing countries which show high levels of both labor and capital income tax evasion (e.g., Crivelli et al. (2016)).

Using an R&D-based growth model with dual regulation, we analyse how environmental policies influence pollution, corruption, a growth rate, and welfare. Considering that polluting firms bribe bureaucrats to evade paying environmental tax, we find that a stricter environmental tax leads to a decrease in growth rate via a decrease in the permit rent as well as an increase in pollution and corruption per firm and results in worsening households’ welfare and in improving the bureaucrats’ welfare. Thus, tax evasion with corruption improves households’ welfare and worsens the bureaucrats’ welfare. Our findings imply that tax evasion under dual regulation improves social welfare.

Introduction

With worsening climate, more EU member states are participating in the European Union Emissions Trading System (EU-ETS). Thus, a dual regulation problem is created, whereby firms emitting greenhouse gases are subjected to overlapping regulations: environmental taxes and emissions permit trading. However, industries in the EU have resisted these regulations because such overlapping regulations for the same pollution impose additional costs on firms (Sorrel, 2002). The additional costs from dual regulation may incentivise firms to evade environmental taxes through corruption. The government suffers from corruption, which damages the efficiency of environmental policies. This is because the weakening of environmental regulations as a result of corruption may inhibit economic development and increase pollution (Pellegrini and Gerlagh, 2006). In developing countries, corrupt officials demand bribes from firms in return for overlooking the under-reporting of pollution emissions. Previous studies show that polluting firms evade environmental tax via corruption (i.e. Damania, 2002; Iskandar et al., 2014). Thus, tax evasion with corruption may slow economic development and worsen environmental quality if there is tax evasion in developed countries. Environmental tax evasion is not expected in developed countries. However, European Union (EU) member states such as the United Kingdom (Customs, 2011) report that polluting firms do engage in environmental tax evasion. Thus, in contrast to developing countries, dual regulation in developed countries detrimentally affects the efficiency of emissions permit-trading via tax evasion with corruption.

Restaurant firms extensively expand through acquisitions. While acquisitions can be an efficient business strategy, the extant literature presented evidence showing that acquisitions can be value–increasing or –decreasing investments. However, why acquisitions increase or decrease firm value is not clear. Corporate finance and franchising theories collectively suggest that the value of acquisitions may depend on firms’ free cash flow capacities, growth opportunities, and organizational forms. The purpose of this study is to examine the concurrent effects of free cash flows, growth opportunities, and franchising on restaurant firms’ returns from acquisitions. The results showed that firms with high-free cash flows gain lower returns compared to firms with low-free cash flows, suggesting that acquisitions reduce underinvestment problems but also increase overinvestment problems. Franchising firms also gain lower returns compared to non-franchising firms; however, the availability of free cash flows exacerbates overinvestment problems in franchising firms. Theoretical and practical implications are discussed.

Introduction

Expansion through acquisitions has been a profound method for corporations because it provides acquiring firms an opportunity to grow without losing momentum in margins. Acquisitions also have potential benefits to improve earnings, reduce costs, achieve greater market shares, and increase shareholders’ wealth (Kim and Zheng, 2014; Chatfield et al., 2011; Dogru, 2017). However, acquisitions are often associated with valuation concerns (i.e., liquid and/or fixed assets, etc.) and shareholders’ reactions to price movements before, during, and after the acquisitions both in the short and long-run. Within this context, the neoclassical theory of acquisitions postulates that companies, acting in the best interest of shareholders, acquire another company only if the acquisition increases their value (Rosen, 2006). Empirical evidence, however, indicates that shareholders may not always enjoy positive wealth effects in acquisitions. In particular, returns from acquisitions depend on many other factors such as acquirer’s size (Moeller et al., 2004), method of payment (Alshwer et al., 2011), target characteristics (Harford et al., 2012), and financial constraints (Dogru, 2017). Furthermore, acquisitions that are motivated with managerial overinvestment may be inferior acquisitions and may result in valuedestruction rather than value-creation for shareholders (Jensen, 1986).

We construct a measure of human capital using micro datasets on labor composition of age, gender, education, and wage rate and analyze its role in economic growth for the Korean economy. Over the past three decades, human capital has grown steadily at about 1% per year, contrasting to a continuously declining trend of total work-hours. This growth has been driven by the rise of better-educated baby-boom cohorts. A growth accounting exercise shows that human capital contributes significantly to economic growth; it accounted for 0.5% points of annual GDP growth over the period. Human capital is projected to remain a major growth factor over the next two decades as the increase in educational attainment continues. Increased employment rate of elderly or female workers reduces the aggregate human capital growth while increasing the available labor. Polices to improve human capital of female or elderly workers help to increase aggregate human capital growth.

Introduction

The Republic of Korea (henceforth, Korea) is known for its economic accomplishments. It grew at an average rate of 7.6% each year from 1965 to 2015,1 making it one of the fastest growing economies in the world. Numerous studies on the backdrop of Korea’s economic achievement have pointed out the improvement in human resources, alongside higher savings and investment ratios, greater trade openness, and improvements in rule of law, as significant factors for this growth (Lee, 2016). The expansion and upgradation of the workforce have played a critical role in helping Korea catch up with the economic development of advanced economies. In the early stages, Korea enjoyed a large demographic dividend as large baby boom cohorts reached working age, boosting the nations productive capacity. The nation has also accumulated a stock of educated workforce at an unprecedented rate, backed by a strong household demand for higher education, and high public investment in the education sector. The abundant supply of welleducated labor force has allowed Korea to improve the competitiveness of its industries, transforming the economy into one of the worlds’ top exporters. In this paper, we present a measure of aggregate human capital stock in Korea and evaluate the contribution of human capital to GDP growth rate from 1986 to 2017. In addition to analyzing the past human capital development, we construct projections of human capital growth over 2020–2040, considering changes in population structure, educational attainment, and main labor market variables, such as employment and wage rate, with diff ;erent sets of scenarios.

This paper studies the dynamics of economic growth and tourism evolution for 80 countries during the period 1995–2016. The variables representing economic and tourism growth are growth rates of per capita GDP and international tourist arrivals per inhabitant respectively. Using the concept of economic regime, the paper introduces a notion of distance between the dynamical paths of different countries. Then, a Minimal Spanning Tree and a Hierarchical Tree are constructed to detect groups of countries sharing similar performance. The two main clusters we find can be interpreted as two groups of countries with high and low performance in the tourism sector and are coherent with the business cycle. The evolution of such clusters shows three main stylized facts: certain countries move across clusters; the low performance cluster tends to span, while the high performance one tends to be (more) compact; the distance between the two groups increases in time.

Introduction

In this paper, the relationship between tourism and economic growth is explored. To this end, the study introduces an alternative non parametric methodology to the very well-known econometric tools commonly used in the empirical literature investigating tourism and economic growth. This methodology is used to study the dynamics of economic growth and tourism performance for 80 countries during the period 1995–2016. The fact that the methodology do not need to assume a particular model to study the relationship between the variables under study allows to understand the dynamic behaviour of the countries in the sample and to compare their performance. With this usage, the socalled tourism-led-growth-hypothesis (TLGH) can be seen in a different light and could call for a complete reformulation. In particular, our contribution to the TLGH literature includes the possibility of testing if different countries cold admit a similar model representing the dynamics in tourism and economic growth. In addition, this tool can be used when working with panel data to test the homogeneity of individuals in the panel. This central hypothesis of homogeneity of individuals is addressed by using clustering techniques that help to find homogeneous groups of countries with similar dynamics in tourism and economic growth. Then panel data can be correctly used for each cluster in the sample. The tourism sector is recognized to positively contribute to the economic growth process of a country through different channels, including the fact of course that it is a currency earner sector; that stimulates physical and human capital accumulation, and pushes (and uses) technology and innovation. At the same time, tourism promotes directly and indirectly other economic industries such as transportation, hospitality or retailing (see Mayer & Vogt, 2016). In particular, international tourism is a source of foreign currency that facilitates the acquisition of capital goods and technologies, which can be used in other production processes. In addition, it plays a significant role stimulating investments in new infrastructure and promoting competition, creating employment and corresponding household income. Last but not least, it must be noted that tourism is a significant sector of diffusion of technical knowledge, and potentially it can stimulate research and development.

Given that the European Union -28 countries proposed a target of 3% of the Gross Domestic Product on research and development (R&D) expenditure by 2020, the current study attempts to examine the role of R&D on environmental sustainability. In addition, the study further investigates the long-run and causal interaction between, renewable energy consumption, nonrenewable energy consumption, and economic growth in a n ecological footprint -income function. Notably, the study incorporates research and development (R&D) expenditure to the model as an additional variable, and measures impact of each variable on ecological footprint. Empirical evidence is based on a balanced panel data between annual periods of 199 7 –2014 for selected EU -16 countries. The Pedroni, Johansen Multivariate and Kao tests all reveal a cointegration between ecological footprint, economic growth, research and development expenditure, renewable, and nonrenewable energy consumption. The Fully Modified and Dynamic Ordinary Least Squares model s (FMOLS and DOLS) both suggest a negative significant relationship between the countries’ research and development expenditure and ecological footprint in the long -run. This implies that spending on R&D significantly impacts on environmental sustainability of the panel countries. Our study affirms that nonrenewable energy consumption and economic growth increase carbon emission flaring while renewable energy consumption declines ecological footprint. The panel causality analysis reveals a feedback mechanism between ecological footprint, R&D expenditure, renewable, and nonrenewable energy consumption. We further observed a one – way causality between ecological footprint and economic growth. The current further validates that the Environmental Kuznet Curve Hypothesis (EKC) holds for this panel of EU countries examined. Effective policy implications could be drawn toward modern and environmentally friendly energy sources, especially in attaining the Sustainable Development Goals via spending on R&D .

Introduction

Consumption of energy has become increasingly beneficial in the advancement of many economies in the 21st century. Global dependence on the energy sector as a driver in the development processes has led to an increased level of the world’s demand for energy (Ozcan and Ozturk, 2019) . Among other factors, rise in energy consumption is connected to significant rise in population (Feng et al., 2018) as well as increasing drive for growth and urbanisation among nations particularly the emerging economies. This has further led to the depletion of the environment, thereby threatening the ecological balance of the biosphere (Chu et al., 2017; Alola, 2019a, b; Bekun, Emir & Sarkodie; Saint Akadiri et al., 2019 ) . Additionally, in a bid to achieve industrial expansion and growth, many economies are forced to meet up their increasing energy demands through non -renewable energy (NRE) sources to mitigate adverse environmental consequences . According to Nathaniel & Nathaniel (2019) , industrial growth do not only increases energy use but equally increases the level of environmental degradation through emissions of toxic gases chiefly from nonrenewable energy. The reason is partly due to the little share of eco -friendly renewable energy sources in the global energy market in relation to NRE sources (Ozcan and Ozturk, 2019). Consequently, negative externalities have been generated in the form of carbon emissions, resource depletion, pollution, wildlife endangerment, climate changes and global warming (Hanif et al., 2019).

1- Introduction

2- Literature review

3- Data and methodology

4- Findings and interpretations

5- Conclusion

References

Abstract

Purpose – The purpose of this paper is to examine the relationship between foreign direct investment (FDI) flows and institutional stability. The focus country is Canada. It is one of the few countries where the economy remained relatively stable compared to other economies during the Global Financial Crisis. It is crucial for Canada to determine the optimal level of institutional development to attract more FDI and sustain the sound financial stability in future.
Design/methodology/approach – This study uses the auto-regressive distributive lag (ARDL) approach to understand the relationship between FDI and institutional stability along with other controlled variables, for instance, gross national product, inflation and exports.
Findings – The key finding of this work is that FDI and institutional stability are cointegrated in the long run. The error correction model of ARDL shed light on institutional stability being an exogenous variable, and FDI is an endogenous variable. Institutional stability affects FDI, as it is exogenous. The findings will help policymakers to implement policies to strengthen the institution’s settings, and this, in turn, will attract more investment.
Originality/value – Based on previous theoretical and empirical literature, most of the research points to FDI positively affect institutional stability. In some cases, the relationship does not always hold true. This study will fix the gap in the literature by investigating the relationship between FDI and institutional stability of Canada.

Introduction

Foreign direct investment (FDI) inflows were $1.45tn in 2013 and are expected to rise about 5 per cent in 2017 to almost $1.85bn (United Nations Conference on Trade and Development [UNCTAD], 2017). The top host countries for FDI inflows as of 2016 include the USA, Ireland, Hong Kong, China and Singapore. Also, North America is the top region of FDI outflow. To further add, from the period of 2000 to 2012, about 55 countries adopted 1,082 institutional policy changes, with the goal of creating a more favourable environment for foreign investors (Demir, 2016). Prior studies indicate that proper institutions encourage private investments, improve the efficiency of the economic system and encourage economic growth (Acemoglu et al., 2005; Ahmad and Ahmed, 2014; Hall and Jones, 1999; Rodrik et al., 2004). Institutions play a crucial role in disciplining the behaviour of economic agents, thus encouraging setting rules and limit opportunism and build transactional trust in financial transactions, and ultimately enhance the confidence of foreign investor and FDI inflows (Ahmad and Ahmed, 2014). In a study by Makki and Somwaru (2004), the results pointed to FDI and exports positively impacting economic growth. The study looked at 66 developing countries from 1970 to 2000. Wang and Meng (2004) found that it is more critical to higher-income countries, whereas international trade is more critical for lower-income countries (Tekin, 2012). On the other hand, other studies were not able to find a direct link between FDI and institutional development (Buchanan et al., 2012; Wheeler and Mody, 1992). In another study by Harms and Ursprung (2002), political and civil liberties were found to be factors that attracted FDI as opposed to institutional aspects (Ahmad and Ahmed, 2014). As such, it is inconclusive as to if institutional stability plays a fundamental role in encouraging FDI. Furthermore, there is theoretical literature that suggesting FDI can adversely impact economic growth. It is because the growth accelerating the effect of FDI is based on the assumption that this does not crowd out domestic investment (Tekin, 2012). There is also theoretical literature that supports the notion of institutional stability encouraging FDI. For instance, the Douglas North approach discusses how institutions play a crucial role in economic growth. Even from a theoretical perspective, it seems that the literature is inconclusive on the exact role that institutional stability plays, and how other factors react to it.

The United States has achieved economic growth compatible with carbon reduction since 2007. This work is addressed to understand the eight effects, especially effects related to research & development (R&D) on the decoupling economic growth from carbon emission through a decomposition technique and a decoupling effort model. The results of sector analysis show that the changes of carbon emission in industry sector and transportation sector were dominant contributor and inhibitor to the drop of carbon emission, respectively. The decomposition results indicate that energy intensity was the leading contributor to the drop of carbon emission, followed by R&D intensity, sectoral carbon intensity, R&D efficiency; whereas economic scale was the primary inhibitor to the drop of carbon emission, followed by investment intensity, population size and sectoral energy structure. The results of decoupling efforts analysis uncover that energy intensity, R&D intensity, R&D efficiency and sectoral carbon intensity contributed to decoupling economic growth from carbon emission, whereas investment intensity, population size and sectoral energy structure did not contribute to the decoupling. Finally, some policy implications are proposed.

Introduction

In recent decades, global warming has received considerable attention and concerns, due to its negative impact on social and economic development. International community has been making great efforts to control climate change, from United Nations Framework Convention on Climate Change, Kyoto Protocol to The Paris Agreement. Carbon emission is one of main contributors to global warming. According to Global Carbon Project (GCP), total global carbon emission exceeded 30 billion tons, increased by1.6% in 2017. While in 2018, it is expected to increase by 2.7%, having possibility to hit a New High. Carbon emission from energy consumption accounts for nearly 80% of total global carbon emission. Therefore, controlling energy-related carbon emission will play a critical role in restraining global carbon emission and temperature rise. The United States announced to withdraw Kyoto Protocol in 2001. However, despite the government did not perform international responsibility of fighting against climate change together with international community, its energy-related carbon emission reached the peak of 6006 million tons in 2007, then progressively decreased, truly achieving decoupling. Hence, it is of great significance to figure out underlying reasons to decoupling energyrelated carbon emission from economic growth in the United States.

Introduction

The 2008–2009 economic and financial sovereign debt crisis led to a substantial drop in both GDP and investment levels and growth rates. Moreover, it led to substantial changes in economic policy, namely budgetary policy. Under budgetary duress, the level of government indebtedness is deemed to have a negative impact on public investment in EMU member countries (see, for instance, Turrini 2004, for the cases in the 1980s and in the 1990s). In fact, the abovementioned changes took in several countries the form of reduced expenditure, including public investment, and increased taxation. It is expectable that these changes may well constitute a policy regime change with structural implications on previous estimations regarding the relevance of investment for long-term growth. Additionally, such policy changes, and especially in euro area countries following adjustment programs, notably after the 2008–2009 economic and financial crisis, came with an emphasis on structural reforms that concern public spending levels and structure, and more generally, the way the economy and markets operate. It becomes then important to test if macroeconomic efficiency changes effectively occurred, and in what direction. For instance, Afonso and Jalles (2015) argue that the relevance of fiscal components differs for private and public investment developments. Understanding and measuring linkages between public and private investment and economic growth is of crucial importance in both developed economies and emerging markets. Public investment is a part of public expenditure (typically accounted for in the General Government) and decisions are taken within the larger framework of public finance. At the same time, it constitutes an addition to public capital. The latter, together with private and human capital, labour and other inputs, is in several approaches considered as a production factor. Public investment may therefore be linked to growth prospects. However, and as it is well documented in the literature, as part of public expenditure, it may crowd other types of investment, namely private, so that in some circumstances the net impact of public investment on GDP may be negative (see, for instance, Dreger and Reimers 2016; Cavalcanti et al. 2014; IMF 2014). At the same time, note the importance of public investment in the fiscal surveillance mechanisms of the EU, where n° 3 of Article 126 of the Treaty of the European Union (TEU 2012) reads:

1- Introduction

2- Policy background

3- Estimation strategy

4- Main results

5- Mechanisms

6- Welfare analyses

7- Conclusion

References

Abstract

This paper examines whether a target-based performance evaluation system can properly motivate local bureaucrats to implement an environmental regulation policy at the cost of slow economic growth. In late 2005, the Chinese central government made cutting sulfur dioxide (SO2) emissions the main performance evaluation criterion for prefectural city mayors and Party secretaries. Using a difference-in-differences framework, we find that the performance evaluation system caused a significant decrease in SO2 emissions, as well as in the GDP growth rate. Our mechanism analyses further corroborate that local bureaucrats in Two Control Zone cities were willing to trade off GDP growth to achieve the more stringent emissions reductions goal. Our findings contribute to the understanding of multitasking agency problems for government agents.

Introduction

Economic growth has many implications for the environment and sustainability. Longrun growth depends not only on emission flows but also on the assimilative capacity of the environment. The importance of environmental protection has brought emissions reductions to the awareness of policy makers in many developing countries. However, emissions reductions are usually tied to short-run growth cuts. In developing countries, where economic growth has been the focus, how can local bureaucrats be motivated to implement an emission control policy, and how would it affect economic growth? This paper investigates how local bureaucrats respond to a performance evaluation system targeting emissions control in China. China has been the fastest-growing major economy over the past three decades, but this growth has come at the cost of heavy environmental pollution.1 The central government realized the pressing environmental issues and proposed a major policy initiative in 1998 to establish control zones in regions with the highest levels of sulfur emissions or acid rain.