POLLUTION ACROSS CHINESE PROVINCES 中国各省市环境污染.docVIP

POLLUTION ACROSS CHINESE PROVINCES 中国各省市的环境污染 Catherine Yap Co School of Economics, Peking University, Beijing, China 100871; and Department of Economics, University of Nebraska at Omaha, Omaha, Nebraska, 68182 Corresponding author Fanying Kong Department of Sociology, Midland Lutheran College, Fremont, Nebraska 68025 Shuanglin Lin School of Economics, Peking University, Beijing, China 100871; and Department of Economics, University of Nebraska at Omaha, Omaha, Nebraska, 68182. I. Introduction The market-oriented economic reforms starting 1978 have greatly changed the landscape of the Chinese economy. State-owned enterprises (SOEs) were allowed to operate and compete on free market principles, rather than under the direction and guidance of state planning; special economic zones were established along the coast for the purpose of attracting foreign direct investment, boosting exports, and importing high technology products; and, private enterprises were legalized and encouraged. With these reforms, the average annual growth rate of China’s real GDP was close to 10% from 1979 to 2005, compared to a pre-reform growth rate of around 5% from 1960 to 1978. No country has ever lifted more people out of poverty faster than China since economic reforms. However, the fast economic growth has been accompanied by severe environmental deterioration. This paper analyzes China’s pollution problems based on the data from 31 Chinese provinces for the period of 1987 to 2004. According to The Economist (2004), the World Bank estimates that direct damages from pollution (e.g., medical bills) are 8-12% of China’s annual GDP. The World Bank has identified 16 of the 20 most polluted cities in the world to be located in China. And, close to two-thirds of the 300 cities tested by China’s environmental protection agency failed to meet the air quality standards set by the World Health Organization (see The Economist 2004). The number of trucks and automobiles in use increased dramatical