Can Local Government Debt Decrease the Pollution Emission of Enterprises?—Evidence from China’s Industrial Enterprises

The rapid growth of local government debt size in China has aroused the attention academia and policy circles due to its impact on environmental pollution. This paper aims explore corporate pollution emissions mechanism. uses Local Government Debt Database, Industrial Enterprise Pollution Database from 2006 2013, adopts two-way fixed effect model difference-in-differences method conduct an empirical analysis industrial enterprises 31 provinces China. results show that a significant positive emissions, each unit increase leads 0.002 units emissions. Further mechanism tests this is realized through expansion regional asset investment reduction enterprise R&D investment. In addition, there heterogeneity among different ownership, location, industry. provides practical references for governments micromarket actors improve protection governance new era.