Abstract This paper studies local governmental incentives affect under fiscal decentralization on pollution Abatement by econometric mode with the provincial panel data. It is found that with the incentives of GDP, fiscal decentralization increases the industrial pollution emissions and reduces fiscal expenditure of the environmental pollution abatement remarkably, economic and fiscal revenue growth can not change the situation; Moreover, the deterioration in environmental pollution increase the difficulty of environmental pollution abatement with the process of industrialization and Urbanization. FDI does not necessarily result in environmental deterioration. Environmental improvement relies on the appropriate adjustments of the local governments’ assessment mechanism.
2013, Vol. 1 
