Changes in Environmental Performance with Firm Relocation and Its Influencing Mechanism: an Evidence of Chemical Industry in Jiangsu, China.

A micro firm relocation perspective plays important roles in deepening the understanding and knowledge on the environmental effects of industrial transfer and related mechanisms, however, such research and cases are currently scarce. Based on the building of both the database of firm relocation information and a conceptual framework of changes in environmental performance with firm relocation (Delta EP), involving factors of firm heterogeneity and changes in both locational conditions and whole-process pollution treatment paths, chemical firms in Jiangsu Province were selected to explore their Delta EP and related influencing mechanisms by the Wil-coxon signed-rank test of two paired samples and a binary logistic regression model in this study, respectively. Results showed that during 1998-2014, chemical firm relocation experienced a fluctuating growth trend with a continuous surge in inter-city relocation, accompanied by a deterioration in the environmental performance (EP) with a significant reduction of pollution removal intensity (p < 0.01) after firm relocation. Most firms relocated from Southern Jiangsu (72.5%) to places adjoining Jiangsu Province (58.5%), along the river and the coast (63.4%), and in the third-and fourth-tier cities (73.5%), respectively. As for these factors, the low development level of transfer-out (DTOR) and transfer-in region (DTIR) both resulted in the downgrading EP with firm relocation, but the inter-city relocation style (RS) and strict environmental regulation (ER) were the opposite. The benefits for upgrading EP after relocation conferred by the promotion of source-process treatment were limited by RS, DTOR, and DTIR. Among firms relocated to low DTIRs, the higher the firm competitiveness in terms of capital, technology, and environmental awareness, the greater the upgrading EP probability. When firms transferred to regions with stricter ER, the likelihood of improving EP increased more for those firms with weak competency. In a word, in order to prevent the pollution haven effect, superior governments should shrink regional differences in ER policies, whereas local governments in transfer-in regions should provide targeted and essential support in funding and technology according to the firm heterogeneity and fully consider actual con-ditions to make environmental measures in the future.