Urbanization has been positioned as an important driving force for economic development. This article examines the impact of urbanization on environmental regulation efficiency (ERE) in the Yangtze River Basin (YRB). Based on a panel dataset of 97 cities in the YRB from 2005 to 2016, a spatial econometric model was used for analysis. Results show that the average ERE in the YRB is relatively low and manifests in the shape of a curved smile. The urbanization level of the permanent population is far lower than the average level of developed countries. However, the urbanization level is showing a steady growth trend. During this period, ERE in the Yangtze River middle, upper, and lower reaches was measured at 0.77, 0.58, and 0.52, respectively. The urbanization rate was measured at 0.59, 0.45, and 0.39, in the lower, middle, and upper reaches, respectively. When only considering population urbanization, the previously observed negative correlation between ERE and the Kuznets curve disappears. However, if the carrying capacity of economic activities is considered, the U-shaped relationship between urbanization rate and ERE returns. The environmental Kuznets curve is consequently verified. In addition, there is an inverted U-shaped nonlinear relationship between economic development and ERE. The results of this article show that there are unsustainable risks in the rapid pursuit of population urbanization. Only by improving the quality of urbanization and adapting the level of urbanization to the carrying capacity of resources and environment can we truly promote high-quality economic development. The article puts forward some suggestions to promote the green development of the economy.
Keywords: Yangtze River Basin; carrying capacity of economic activities; effects decomposition; environmental regulation efficiency; spatial econometrics; urbanization.