From Fog to Smog: The Value of Pollution Information

79 Pages Posted: 9 Dec 2019

See all articles by Panle Jia Barwick

Panle Jia Barwick

Cornell University - Department of Economics

Shanjun Li

Cornell University - School of Applied Economics and Management

Liguo Lin

Shanghai University of Finance and Economics

Eric Zou

University of Oregon - Department of Economics

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Date Written: December 2019

Abstract

During 2013-2014, China launched a nationwide, real-time air quality monitoring and disclosure program, a watershed moment in the history of its environmental regulations. We present the first empirical analysis of this natural experiment by exploiting its staggered implementation across cities. The program has transformed the landscape of China’s environmental protection, substantially expanded public access to pollution information, and dramatically increased households’ awareness about pollution issues. These transformations, in turn, triggered a cascade of household behavioral changes, including increases in online searches for pollution-related topics, adjustments in day-to-day consumption patterns to avoid pollution exposure, and higher willingness to pay for housing in less polluted areas. As a result of both short- and long-term behavioral changes, the program significantly reduced the mortality impact of air pollution. Conservative estimates suggest that health benefits are at least one order of magnitude larger than the costs of the program and associated avoidance behaviors combined. Our findings highlight considerable benefits from improving access to pollution information in developing countries, many of which are experiencing the world’s worst air pollution but do not systematically collect or disseminate pollution information.

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Suggested Citation

Barwick, Panle Jia and Li, Shanjun and Lin, Liguo and Zou, Eric, From Fog to Smog: The Value of Pollution Information (December 2019). NBER Working Paper No. w26541. Available at SSRN: https://ssrn.com/abstract=3500659

Panle Jia Barwick (Contact Author)

Cornell University - Department of Economics ( email )

414 Uris Hall
Ithaca, NY 14853-7601
United States

Shanjun Li

Cornell University - School of Applied Economics and Management ( email )

248 Warren Hall
Ithaca, NY 14853
United States

Liguo Lin

Shanghai University of Finance and Economics ( email )

777 Guoding Road
Shanghai, AK Shanghai 200433
China

Eric Zou

University of Oregon - Department of Economics ( email )

Eugene, OR 97403
United States

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