The empirical research of the correlation between economic growth and air quality in Tianjin, China

Abstract

This paper identified the correlation between the economic growth and the air quality in Tianjin, China. To specify, the data on GDP per capita from 2003 to 2015 was used to represent the economic growth. Furthermore, to indicate the air quality, five indexes were selected: the concentration of SO2, NO2, and PM10, ambient air quality bad rate, and the volume of industrial. For converting the five correlated indexes into a set of uncorrelated variables, two main components have been extracted from the five indexes through the principal component method in IBM SPSS Statistics. Next, by Unit Root Test, the rate of increasing the GDP per capita and the air quality have a cointegration relationship and Granger Causality Test in Eviews 9.0. Then, when the speed of GDP per capita is increasing 1 unit, the air condition will be worse 0.0725 units from Johansen Cointegration Test. Finally, from VAR model, the air quality was contributed 10% for the fluctuation of the rate of changing GDP per capita in Tianjin, and the rate of changing GDP per capita was contributed 50% for arising the change of air quality. To suggest, the government of Tianjin should make a balance between controlling the speed of increasing the economy and protecting the air quality.