*3.1. Explained Variable*

Industrial pollution covers a wide range, but in this study, it refers specifically to "three wastes" (industrial effluent, industrial waste gas and industrial waste residue) pollution. Considering the availability of data, this study uses industrial effluent emissions, industrial SO2 emissions and industrial soot emissions to measure the discharge of "three wastes", respectively. Due to the different scales of regions, the absolute value data is easy to make the research conclusion "unfair". Therefore, with reference to the design logic of location quotient, this study reduces the dimension of these 3 types of data into a kind of relative value data. The process is as follows:

Step 1. eit,p is the total emission of industrial pollution p (p = 3) of province i in period t; Yit is the actual total industrial output value of province i in period t, and Eit,p is the economic efficiency of industrial pollution emission.

$$\mathbf{E}\_{\rm it,p} = \mathbf{e}\_{\rm it,p} / \mathbf{\varchi}\_{\rm it} \tag{11}$$

Step 2. NEit,p is the economic efficiency of national industrial pollution emission in China. The 30 cross-section samples are represented by "30".

$$\text{NE}\_{\text{it,p}} = \sum\_{\text{i-1}}^{\text{30}} \mathbf{e}\_{\text{it,p}} / \mathbf{Y}\_{\text{it}} \tag{12}$$

Step 3. Calculate the relative value of industrial pollution emission variables (Ind\_polit). The higher the Ind\_polit is, the greater and the more serious the industrial pollution is; otherwise, the smaller the industrial pollution is, the lighter the industrial pollution is.

$$\text{Ind\\_pol}\_{\text{it}} = \text{E}\_{\text{it,p}} / \text{NE}\_{\text{it,p}} \tag{13}$$
