Beyond Pollution for Promotion: Connections of Political Elites and Industrial Air Pollution in China

Discussion Papers

No.823

by Meng Li, Bo Meng, Yuning Gao

September 2021

ABSTRACT

The industrial air pollution in China and mitigation efforts used to combat it may be related to the career incentives of political elites under informal institutions. This study investigates whether and to what extent the personal connections of political elites, that is, patron–client relations between local and upper-level officials, influence China’s industrial pollution at the city-firm level. Our empirical analysis based on a unique data set of firm level pollution paired with information on the political elites suggests the following: local officials who have personal ties to the leader of a province tend to have more pollution-intensive enterprises under their governance; compared to foreign-owned firms, the environmental performance of domestically owned firms are more likely to be affected by these patron–client relations; and the patronage connections help local officials to better “stand in their boss’s shoes,” and can therefore also contribute to more mitigation of firm pollution when green growth is considered important for their career promotion. The findings of this study shed light on the political roots of pollution and its abatement and highlight the role of informal political institutions in environmental governance and pollution mitigation.

Keywords: Political connection, Pollution, Patron–client relation, Environmental management, Career incentive

JEL classification: Q5, Q53

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