Optimal Combination of Air-Related Policies : Empirical Evidence from China

To control severe air pollution, multiple policies have been adopted in China. However, it remains unclear which policies actually mitigate air pollution when multiple policies are adopted together. This paper aims to systemically quantify the effectiveness of fifteen air-related policies and identify the optimal policy combinations for air quality improvements. We employ a fixed-effects regression model with the latest dataset from 334 Chinese cities from 2015 to 2019. We show here that adoption of policy combinations with different types of measures can achieve greater and more effective air improvement results owing to the complementary effects among policies. The effects of policy combinations with the same types of measures are relatively weak due to substitution effects. A holistic policy package involving different policy measures, such as stringent emissions standards for industry, energy transition strategies for residents, market-based trading mechanisms and multi-level supervision, may be the optimal strategy for air quality improvement