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Fiscal decentralization and energy intensity: evidence from a quasi-natural experiment of VAT revenue-sharing reform in China

Yumeng Pang & M Wang

Journal of Public Policy2025https://doi.org/10.1017/s0143814x24000254article
AJG 2ABDC B
Weight
0.46

Abstract

The impact of fiscal decentralization on energy intensity has been a long-standing subject of interest and debate. However, to date, there has been a notable absence of studies delving into the effects of fiscal decentralization on energy intensity from the vantage point of tax sharing. This investigation explores the effects of China’s value-added tax (VAT) revenue-sharing reform on energy intensity using prefecture-level city data from 2006 to 2020. Results show a correlation between an increased proportion of VAT revenue sharing and higher regional energy intensity. Heightened competition among local governments amplifies this impact, while environmental regulations and technological innovation mitigate it. Our findings contribute to a more scientifically grounded formulation of the revenue-sharing ratio between central and local governments, aiming to reduce local energy intensity.

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https://doi.org/https://doi.org/10.1017/s0143814x24000254

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@article{yumeng2025,
  title        = {{Fiscal decentralization and energy intensity: evidence from a quasi-natural experiment of VAT revenue-sharing reform in China}},
  author       = {Yumeng Pang & M Wang},
  journal      = {Journal of Public Policy},
  year         = {2025},
  doi          = {https://doi.org/https://doi.org/10.1017/s0143814x24000254},
}

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Evidence weight

0.46

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.37 × 0.4 = 0.15
M · momentum0.60 × 0.15 = 0.09
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.