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abstract

Environment-biased technical progress can stimulate improvement in environmental quality, leading to coordinated development between the economy and the environment. However, the existing literature scarcely refers to the factors influencing the technical progress bias. We use the overlapping generations model to realize the endogenesis of biased technical progress in the Chinese context. We show that an increase in the aging population will encourage the use of pollution-biased technology and focus the attention of enterprises on improving economic benefits rather than environmental quality. We measure the directions of technical progress during 2003 to 2013 and estimate regressions for the relevant indicators of the labor force employment structure. Under equilibrium, increased ratios of the aging population and state-owned enterprises will stimulate environment-biased technical progress. Further, the effects of research and development and clustering of state-owned enterprises on environmental technology improvement are significant.

6. Conclusions

Environment-biased technical progress is an important factor influencing environmental quality. Then, which factors influence technical progress bias? The previous literature has not studied this question. Using the OLG model, we discussed the effects of the labor force employment structure on the direction of technical progress. Our results provide new insights into the causes of technical progress and contribute to the theoretical literature on the direction of technical progress. We also proposed a new perspective for researching the relationship between employment structure and environmental quality. Environmental technical progress influences environmental quality, and the labor employment structure can affect technical progress through its influence on industrial structure. Our study provided a unique perspective in that the labor employment structure can affect environmental quality through the direction of technical progress.