Productivity of market and environmental abatement in China

Environmental problems are threatening China’s sustainable future. China began the implementation of several environmental policies in the late 1970s and the stringency of these regulations is increasing. We utilize province-level data over the period 1987–2001 to measure various components of productivity within a joint production model that considers both market and environmental outputs. We estimate both Malmquist and Luenberger productivity indices and find that environmental management in China is deteriorating, while the productivity level of joint production is relatively constant.