Research on the Relationship between Global Value Chain and Environmental Pollution: Based on Chinese Firm-Level Data

Global value chain (GVC) is not only value-added distribution chain but also pollution-sharing chain closely related to benefit distribution. With the deepening of firms participating in GVC and under the burden of severe environmental pollution, There is a question on our minds, that is whether smile curves in global value chains bring crying curves in pollution chains. This paper empirically tested the relationship between GVC participation and environmental pollution from firm-level perspective, using the matching data of the China Industrial Firms Database, China Firms Pollution Database, and UIBE Database from 2000 to 2012. The results show that the GVC participation and GVC length have different effects of environmental pollution. GVC participation have negative effects of pollution, while GVC length have positive effects of pollution. Both effects of environmental pollution are influenced by GVC models. This paper provide policy suggestions for environmental protection from the perspective of adjusting GVC participation strategy.