Environmental regulation effect on health poverty in China

Abstract

How does government spending on environmental protection benefit people's health? The current paper analyzed 2010 and 2018 data from the China Family Panel Studies (CFPS) database to measure the impact of province-level environmental regulations on the health of local population. The study also applied the Alkire Foster method to develop the multidimensional health poverty (MHP) score, a new index intended to measure the health status of individuals in a holistic manner. Our results indicated that more fiscal spending on environmental regulation could improve health of the local population, especially among low-income population living in the rural areas. Further, the size of health benefit differs by the type of environmental regulation. More specifically, regulations focusing on preventing environmental pollution can achieve more sizable health benefits than remedial ones. Finally, fine inhalable particle (PM2.5) has the largest mediating effect on the relationship between environmental regulation and public health. These results provide several policy implications, which highlight the importance of: scaling up fiscal environmental expenditure and optimizing the structure of environmental expenditure with more emphasis on rural areas where more low-income population are located; shifting from ex-post accountability to ex-ante prevention; and strengthening regional cooperation in environmental protection among local governments, and establishing a cross-regional coordination mechanism.

Keywords

• Environmental regulation
• Multidimensional health poverty (MHP)
• Spatial effect
• Environmental governance