Blue sky, cold heart: The political cost of environmental regulations

Abstract

Abstract The economic costs of environmental regulations are well documented, but their political cost is still unclear, especially in cases of substantial pollution reduction. This study presents empirical evidence for the unexpected political costs of China's war on air pollution. Using a clean energy regulation as a case, we demonstrate that it significantly reduces air pollutants over a short period; however, exposure to the regulation erodes local political support and trust in government officials. In addition, we show that stringent environmental regulations significantly reduce local political trust when it entails high policy costs for local residents and had weak policy participation. Our results indicate that stringent regulations may improve environmental quality at the cost of local political legitimacy.