Unintended consequences of administrative decentralization on air pollution: evidence from county power expansion in China

How to reduce air pollution is an essential topic of environmental governance. Existing research has predominantly concentrated on the decentralization effect within the environmental field, leaving a gap in exploring non-environmental decentralization effects. This paper exploits a quasi-experiment of "counties power expansion (CPE)" reform in China to examine the effect of administrative decentralization on air pollution. Administrative decentralization will reorganize authority in economic and social matters and redistribute fiscal responsibility and resources for specific targets among multilevel governments. Employing a county-level dataset from 1999 to 2019 in China, we find that administrative decentralization significantly raises air pollution by about 2%. Our results further suggest that air pollution is mainly attributed to the increment of resource input and firm expansion. We find that geographical location will influence the air pollution effect. The policymaker should consider an inclusive intuitional design when launching administrative decentralization.