Labor market distortion and air pollution: An empirical analysis based on spatial effect modeling.

In China, along with the rapid development of economy, air pollution has become a hot issue of public concern, particularly in many cities. The distortion in the labor factor market can cause air pollution, but the underlying mechanism is not yet clear. To investigate this question, this article examines the effect of labor market distortion on air pollution focusing on SO2 emissions based on data of China's 283 cities during 2003-2015. The main objectives are to examine the direct and spillover effects of labor market distortion on air pollution using panel fixed-effects models, including the spatial Durbin model and the mediated-effects model. Results show that labor market distortion directly aggravates air pollution in cities. Mechanism analysis suggests that labor market distortion incurs air pollution through mechanisms of suppressing technological progress, hindering the upgrading of industrial structure, and reducing the efficiency of energy use. Divided the cities by their locations into those in eastern, central, and western regions, we find that such unfavorable effects are more prominent in eastern and western regions of the country. These findings highlight the impetus of mitigating the distorted labor market to ameliorate air quality and promote sustainable development.

Does distorted allocation of capital factors inhibit green technology innovation in Chinese cities? An empirical analysis based on spatial effect.

Distorted allocation of capital factors will lead to the loss of capital market-based soil as the background support for green technology innovation, which will not be able to climb up the value chain and eventually become an economic "colony." This study empirically investigates the relationship between distorted capital factor allocation and green technology innovation using data from 2005 to 2018 for prefecture-level cities in China. The empirical results show that the distortion of capital factor allocation not only has a significant inhibiting effect on green technology innovation in the city, but also hinders the development of green technology innovation in neighboring cities. Mechanism test analysis suggests that there is negative impact via generating mismatch, crowding out, and rent-seeking effects. Further research shows that the effect of distorted capital factor allocation on urban green technology innovation is more influential in the eastern and western regions. The conclusions of this study have important practical significance for optimizing the rational allocation of factor resources, promoting green technology innovation, and achieving high-quality economic growth.