Pollution control in urban China: A multi-level analysis on household and industrial pollution

Abstract This paper studies the effectiveness of pollution control in urban China by constructing a two sub-system analysis: household pollution control subsystem and industrial pollution control subsystem. We integrate slack-based model with undesirable outputs to estimate the pollution control efficiency in two subsystems for Chinese provinces from 2011 to 2015. The results show strong evidence on provincial and regional heterogeneity in pollution control efficiency for both systems. At provincial level, Beijing, Shanghai, Jiangsu, Guangdong, Hainan, and Qinghai have achieved full efficiency in both household and industrial pollution control compared with other provinces. At regional level, the Eastern Coastal region is the most effective area in environmental protection among eight economic regions in China. We then measure the economic importance of controlling various pollutants by dual price approach. Policy suggestions for each region are given to improve the effectiveness of pollution control in urban China.