Understanding the Intersection of Central Environmental Protection Inspections and Green Investment Through Game Theory

The Central Environmental Protection Inspector (CEPI) is an innovation in China’s environmental regulation. This paper uses game theory to analyze the influence of the CEPI on enterprises’ green investment. Firstly, by constructing the game model of “central government-local government-polluting enterprises”, the factors affecting green investment strategy are analyzed. Then, with the help of a system simulation model, the influence of parameters on system stability and convergence trends is analyzed, so as to obtain the influence of the CEPI on enterprise green investment. The results show the following: (1) The CEPI can effectively promote preventive green investment, and the promotion effect of preventive green investment is proportional to its risk; (2) The effect of the CEPI on local governments is not obvious; (3) The cost of the CEPI is too high, and polluting enterprises are quick to choose remedial green investment.