China Policy Journal Volume 1, Number 1, Fall 2018 | Page 150

Chronic Noncompliance and Ineffective Enforcement in Guangzhou
Figure 1. The analytical framework on the relationship between formality of
compliance regime, degree of enforcement coerciveness, and compliance rates
dingzi hu). These polluting firms have
received the highest frequency (once
or more than once per year between
2007 and 2015) and the highest intensity
(measured by the amount of fines
and the number of coercive sanctions
such as suspension, shutdown, and relocation)
of penalties and yet have continued
with new pollution emissions.
The second type of chronic violators’
noncompliant behavior is more fluctuating,
with obvious ups and downs over
time. In good years, polluting firms falling
into this category would avoid any
records of noncompliance in one year
and then receive multiple warnings and
penalties in the next because of their illegal
emissions.
It is noteworthy that the enterprises
with governmental and foreign
ownerships can all be serious violators
of environmental standards. Neither do
SOEs and private companies demonstrate
any distinctive patterns in terms
of their chronic noncompliant behavior.
The diversity of ownership of polluting
firms not only challenges the
conventional proposition that foreign
companies have better environmental
performance or that private companies
tend to do a better job in environmental
compliance than SOEs, but it also
shows a high degree of heterogeneity of
targets of environmental enforcement
(Wang and Jin 2007).
Another important feature of
chronic corporate noncompliance in
Guangzhou is that a large number of the
violators are small plants. Many of these
small polluters are scattered throughout
the city outskirts or in “urban villages”—this
is a peculiar phenomenon
in the PRD due to the rapid uneven urban
expansion into the rural areas, and
this has left patches of formerly rural
villages and their land enclaved in the
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