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ANALYSIS ABOUT THE EFFECTS OF INDUSTRIAL PRODUCTIONS ON AIR POLLUTION

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ANALYSIS ABOUT THE EFFECTS OF INDUSTRIAL PRODUCTIONS ON AIR POLLUTION

Page 1 of 17


ANALYSIS ABOUT THE EFFECTS OF INDUSTRIAL PRODUCTIONS ON AIR POLLUTION

Lu Li, Zhaowei Liu
ECON508: Applied econometrics
May 10, 2013

Abstract
In China, many environmental problems have been ignored when it mainly focused on a higher pace of economic growth for a long time. In this paper, we aim at finding the relationship between air pollutions and its potential contributor—industrial development. And we are also interested in finding out which department in industry contributes most to air pollution. With these questions, it is essential for us to bring our analysis into a practical and comprehensive content. In this paper, we choose air pollution indicators and industry output in provincial level, thus we would like to test it based on different regions. We use the fixed effect model to construct the data and use hypothesis testing to testify our model through three characteristics: normality, heteroskedasticity and autocorrelation. After the regression and test, we come to the conclusion that basically our model is an appropriate one although several data and time series problems limit its further accuracy. And what is more, the result is quite accordance with our assumption that industrial sectors do effect the environment to some extent and among all the sectors we discuss, mining is the most overarching element. In order to obtain a better and more convincing result, we still need more information about air quality in our further study and research.

Keywords: air pollution; industrial sector

Chapter 1 Introduction
1.1 Identification of the research problem
“It was a foggy day in London, and the fog was heavy and dark. Animate London, with smarting eyes and irritated lungs, was blinking, wheezing, and choking; inanimate London was a sooty specter, divided in purpose between being visible and invisible, and so being wholly neither.”1 The great smog described by...