Local protectionism and national oversight: political connection and the enforcement of environmental regulation in China

The enforcement of environmental regulations is vital for effective governance of environmental issues. While existing literature primarily examines the reasons for inadequate enforcement of these regulations from a central-local perspective, the influence of enterprises' political connections has not been sufficiently addressed. This research aims to fill this gap by creating a unified framework that integrates the roles of the central government, local governments, and enterprises. It investigates how politically connected enterprises respond differently to environmental regulations imposed by both local and central authorities. Utilizing a unique dataset comprising 17,410 pollution records of privately-owned industrial enterprises from 2011 to 2018 in southern Province A of China, our study reveals a positive association between political connection and increased pollution emissions. Notably, this relationship is more pronounced in counties characterized by stringent local environmental regulations. However, following the introduction of central environmental protection inspections by the central government, the pollution outputs from politically connected private enterprises diminish. This study significantly contributes to the existing literature on the enforcement of environmental regulations as well as political connections, offering important policy implications for future environmental governance.