The impact of environmental regulation on firm exports: evidence from environmental information disclosure policy in China.

As an important environmental regulation tool, does the environmental information disclosure have the pollution haven effect and adversely affect Chinese export? Research on such topics can provide implications for Chinese policymakers to formulate realistic environmental policies and employ information disclosure environmental regulation tools to coordinate the economic-environmental development. Using the 2003-2013 Annual Survey of Industrial Firms Database and difference-in-difference identification, we examine the effect of environmental information disclosure policy on firm exports and its impacting mechanisms. The empirical results show that the Chinese environmental information disclosure policy has reduced the scale of industrial firms' exports in the regulated regions, indicating the existence of the pollution heaven effect in China. And also, we find that this policy mainly inhibits export activities of enterprises in coastal areas. Considering enterprise heterogeneity, the policy plays an inhibitory role in the exports of the non-state-owned firms, large firms, and low-productivity firms. Furthermore, the impact mechanism test shows that corporate financing constraint and production costs are important channels for environmental information disclosure policy affecting corporate export activities. It implies that, in developing countries such as China, policymakers and enterprises need to adopt forward-looking strategies to reduce the negative influence of environmental constraints on corporate exports and coordinate environmental governance and sound development of enterprises.