Policies meant to boost 'tourism' actually did a better job of cleaning up water pollution than actual environmental laws did.
March 26, 2026
Original Paper
The Unintended Environmental Consequences of Culture-oriented Institutional Reform: Evidence from Water Pollution in China
SSRN · 6469730
The Takeaway
By incentivizing cities to prioritize their cultural image to attract tourists, the government inadvertently forced a massive industrial shift away from heavy polluting sectors. It shows that the most effective environmental solutions can come from policies that have nothing to do with the environment.
From the abstract
This paper exploits China’s culture-oriented institutional reform as a quasi-natural experiment to examine the impact of cultural policies on water pollution. Using a difference-in-differences approach with city-level panel data from 2003 to 2020, we find that the reform leads to a significant reduction in water pollution in pilot cities. Heterogeneity analysis indicates that the effect is more pronounced in cities with better economic performance, higher administrative status, richer tourism re