In China, environmental regulators play by the rules, but often bend them in ways that reflect important environmental and social concerns. Regulators give little or no slack to heavy dischargers.
Old factories pay more, state-owned factories pay higher rates, and big employers get a discount.
Industry compliance with pollution regulations is far from universal, even in North America. In developing countries, compliance rates are often quite low, particularly where budgets for regulation are low or inspectors are corrupt. And strictness of enforcement varies. But research on determinants of compliance and enforcement is rare, even in industrial societies. Dasgupta, Huq, and Wheeler use new plant-level data for China to analyze variations in both compliance and enforcement, with a focus on regulation of water pollution.