Spillover Effects of Environmental Regulations on Water Use Efficiency: A Case Study of the Yellow River Basin in China

Water scarcity and low utilization efficiency are key constraints to the sustainable development of the Yellow River Basin, and environmental regulation can address these challenges by improving water use efficiency. Furthermore, given its cross-regional heterogeneity and water resource interdependencies, it is essential to investigate the spatial spillover effects of environmental regulation on water use efficiency to support integrated water resource management in the basin. This paper analyzes the spatiotemporal evolution characteristics of water resource utilization efficiency based on panel data from 78 prefecture-level cities in the Yellow River Basin from 2009 to 2021. Using the Spatial Durbin Model, this study examines the direct impact of environmental regulations on water resource utilization efficiency, along with its spatial spillover effects and heterogeneity. The results reveal that water use efficiency in the Yellow River Basin exhibits a fluctuating upward trend, with an average annual growth rate of 5.15%. Spatially, the efficiency in the middle and lower reaches is significantly higher than in the upper reaches. Additionally, the center of gravity of efficiency has shifted southwest, with a migration distance of 138.978[Formula: see text]km. Water use efficiency follows a high-to-low pattern from east to west, with the gap widening each year. In the north–south direction, the pattern has shifted from higher efficiency in the north and lower in the south to the opposite, with higher efficiency now in the south and lower in the north. The Spatial Durbin Model analysis shows that increasing environmental regulation levels can improve local water use efficiency as well as enhance efficiency in neighboring areas. The impact coefficients are 0.041 and 0.121, respectively, both of which are statistically significant at the 1% level. The analysis of regional heterogeneity indicates that environmental regulations in the midstream areas significantly improve local water resource utilization efficiency, with an impact coefficient of 0.139. These regulations also generate notable positive spatial spillover effects in the lower midstream and downstream areas, with impact coefficients of 0.239 and 0.106, respectively. The analysis of city-scale heterogeneity shows that in small cities, enhancing environmental regulation levels can effectively improve local efficiency with an impact coefficient of 0.066. In contrast, in large cities, environmental regulation policies are more likely to boost efficiency in surrounding areas, with an impact coefficient of 0.087.