Economic Effects of Environmental Crises: Evidence from Flint, Michigan

67 Pages Posted: 16 Jul 2019

See all articles by Peter Christensen

Peter Christensen

University of Illinois at Urbana-Champaign

David Keiser

Iowa State University - Center for Agriculture and Rural Development (CARD); Iowa State University - Department of Economics

Gabriel Lade

Macalester College - Department of Economics

Date Written: June 20, 2019

Abstract

In April 2014, Flint, Michigan switched its drinking water supply from the Detroit water system to the Flint River as a temporary means to save $5M. Over the course of eighteen months, it was revealed that the switch exposed residents to dangerous levels of lead, culminating in an emergency declaration in October 2015. In this paper, we examine economic impacts as this crisis unfolded. We estimate that averting expenditures since the switch have exceeded $20M and the value of the Flint housing stock has fallen by $345M to $500M. Over this same period, state and federal spending has exceeded $343M.

Keywords: drinking water, pollution, lead, Flint, crisis, averting behavior, hedonics

JEL Classification: H12, H41, Q51, Q52, Q58, R31

Suggested Citation

Christensen, Peter and Keiser, David and Lade, Gabriel, Economic Effects of Environmental Crises: Evidence from Flint, Michigan (June 20, 2019). Available at SSRN: https://ssrn.com/abstract=3420526 or http://dx.doi.org/10.2139/ssrn.3420526

Peter Christensen

University of Illinois at Urbana-Champaign ( email )

601 E John St
Champaign, IL 61820
United States

David Keiser (Contact Author)

Iowa State University - Center for Agriculture and Rural Development (CARD) ( email )

Ames, IA 50011
United States

Iowa State University - Department of Economics ( email )

260 Heady Hall
Ames, IA 50011
United States

Gabriel Lade

Macalester College - Department of Economics ( email )

1600 Grand Ave.
Saint Paul, MN 55105
United States

HOME PAGE: http://gabe-lade.com

Register to save articles to
your library

Register

Paper statistics

Downloads
11
Abstract Views
126
PlumX Metrics