Pollution for Promotion

Abstract

This paper demonstrates that China’s high environmental pollution levels can partly be explained by the incentives embedded in the country’s political institutions. Guided by a simple career concerns model with the choice of dirty and clean technologies, I examine empirically how promotion incentives of provincial governors aect pollution. To nd exogenous variation in promotion incentives, I explore within-governor variation in connections with key ocials due to reshuing at the center and document the fact that connections are complementary to economic performance for governors’ promotion. The data conrms the model prediction that connections increase pollution. Auxiliary predictions of the model are also conrmed