Environmental Regulation, Market Failures, and Pediatric Health: Evidence from Gold Mining in Tanzania

Abstract

This study examines how institutional deficiencies in emerging nations transform mineral wealth into health risks. Using innovative geographical data from Tanzania’s gold mining industry, we assess the impact of mining pollution on child stunting. Our empirical strategy addresses endogenous household location decisions by employing past migration patterns as an instrument and a data-driven approach to establish treatment boundaries. We find that mining pollution significantly affects children’s health within 9 km of mines, increasing stunting incidence by 9 percentage points, with effects intensifying to 16 percentage points within 5 km. Water contamination is the primary pathway, particularly harming households reliant on well water. These findings highlight the role of weak environmental regulations and poor infrastructure in exacerbating health risks. Our results suggest that strengthening institutions may be as crucial as traditional environmental regulations in mitigating mining-related health costs, underscoring the broader implications of resource extraction on public health in developing nations.

Keywords: Mining, health, regulation, pollution.