Industrial Pollution-Control Investment, Economic Development, and Tertiary-Sector Employment: Evidence from China’s National Time-Series Data, 1998–2024

Abstract

In the course of simultaneously advancing green transformation and the transition of employment toward the service sector, China has witnessed close interrelationships among environmental governance investment, the level of economic development, and the structure of service-sector employment. This study employs the national tertiary-sector employment share as the dependent variable, completed investment in industrial pollution control as the principal explanatory variable, and GDP per capita as a control variable. Stationarity tests, correlation analysis, and multiple regression estimation are conducted using EViews, while Newey–West heteroskedasticity- and autocorrelation-consistent standard errors are applied to correct for heteroskedasticity and serial correlation. The empirical results indicate that all three variables are integrated of order one, I(1), and that the model exhibits no multicollinearity. Both industrial pollution-control investment and GDP per capita significantly increase the tertiary-sector employment share, with economic development exerting a more pronounced effect on employment restructuring. Theoretically, this study develops an integrated time-series framework encompassing the three variables, quantifies the intensity of environmental regulation using a continuous measure of pollution-control investment, and clarifies the transmission mechanism through which economic growth facilitates the realization of green employment dividends. By addressing the limitations of existing research, which frequently examines individual variables in isolation and relies predominantly on regional samples, this study strengthens the body of macroeconomic empirical evidence concerning green development and labor allocation.