Abstract：To estimate the environmental benefit and its distribution and understand the complex coupling links between economic growth and environmental protection, this paper estimated the cost models of pollution control process of industrial wastewater and waste gas based on a firm-level panel dataset from 2011 to 2013 by matching the Chinese industrial enterprise database and the environmental statistics database. The total environmental benefits of industries in China were obtained through estimation and aggregation by both sub-industry and pollutant. And then constrained regression model were employed to estimate the distribution of environmental benefits among corporate profits, employee wages and government taxes. We found that the total annual environmental benefits of China’s industry were nearly 900-billion-yuan, accounting for 2% and 5% of corresponding GDP and industrial added value, respectively. About 70% of total environmental benefits were generated by energy-intensive industries. In terms of benefit incidence, residents were proved to be primary beneficiaries who obtain about 80% of the total benefits. The government was the second largest beneficiary, while the share going into industrial profits was less than 3%. Nearly 25% of industrial wages came from environmental benefits and the figure reaches 50% for energy-intensive industries. The findings of this paper indicated that utilization of environmental resources was one of key drivers for economic growth, and more strict environmental regulation in industries might lead to asymmetric adjustment regarding benefit pattern with wage level and employment being the first to be affected. Accordingly, suggestions were proposed to establish interest balancing mechanism to coordinate partial interests with integral interests and short-term interests with long-term interests in the process of pursuing green development in China.
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