Research on the Relationship Between Environmental and Economic Coupling Systems in Bohai Bay Area Based on a Vector Autoregression (VAR) Model

This study analyzed the impact of land-based contaminants and tertiary industrial structure on economic development in the selected Bohai Bay area, China. Based on panel data spanning 2011 – 2020, a vector autoregressive (VAR) model is used to analyze and forecast the short-run and long-run relationships between three industrial structures, pollutant discharge, and economic development. The results showed that the environmental index had a long-term cointegration relationship with the industrial structure economic index. Per capital chemical oxygen demand (PCOD) and per capita ammonia nitrogen (PNH₃N) had a positive impact on delta per capita GDP (dPGDP), while per capita solid waste (PSW), the secondary industry rate (SIR) and delta tertiary industry (dTIR) had a negative impact on dPGDP. The VAR model under this coupling system had stability and credibility. The impulse response results showed that the short-term effect of the coupling system on dPGDP was basically consistent with the Granger causality test results. In addition, variance decomposition was used in this study to predict the long-term impact of the coupling system in the next ten periods (i.e., ten years). It was found that dTIR had a great impact on dPGDP, with a contribution rate as high as 74.35% in the tenth period, followed by the contribution rate of PCOD up to 3.94%, while the long-term contribution rates of PSW, SIR and PNH₃N were all less than 1%. The results show that the government should support the development of the tertiary industry to maintain the vitality of economic development and prevent environmental deterioration.