The impact of government-enterprise collusion on environmental pollution in China

Kai Hu, Daqian Shi*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


Pollution emissions in China are associated with the relationship between local governments and enterprises, especially in those cities with government-enterprise collusion (GEC). We evaluate the causal relationships between GEC and SO2 emissions at the enterprise level, by adopting the Propensity Score Matching–Difference in Difference method from a comprehensive environmental database. The empirical results show that, compared with those in the cities without collusion, SO2 emissions of enterprises in the colluded cities increase by 11.3% (95% Confidence Interval (CI): 0.041–0.186). These GEC effects are more substantial in the cities whose regional officials work with longer terms, in the foreign-owned or small-scale enterprises, and the labour-intensive industries. The findings suggest the existing environment and personnel management policies in China should be adjusted for more sustainable development.

Original languageEnglish
Article number112744
Number of pages7
JournalJournal of Environmental Management
Early online date11 May 2021
Publication statusPublished - 15 Aug 2021


  • Government-enterprise collusion
  • Pollution emissions
  • Propenity score matching
  • Difference in difference
  • Chinese political systems


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