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Air pollution-induced brain drain: Evidence from inventor mobility

Author

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  • Liu, Shasha
  • Kong, Dongmin
  • Zhang, Jian

Abstract

This study attempts to examine the impact of air pollution on inventor mobility. Specifically, we find that the number of polluting facilities surrounding inventors' workplaces significantly affects their mobility. To establish causality, we introduce the NOx Budget Trading Program of 2003 as an exogenous shock and find consistent results. We further demonstrate that the air pollution drives inventors to relocate to areas with better air quality. We present several economic mechanisms underlying our findings, including inventors' career concerns, knowledge generality, and knowledge complementarity. Finally, we show that the net outflow of inventors negatively affects firms' innovation outputs.

Suggested Citation

  • Liu, Shasha & Kong, Dongmin & Zhang, Jian, 2024. "Air pollution-induced brain drain: Evidence from inventor mobility," International Review of Financial Analysis, Elsevier, vol. 91(C).
    • Handle: RePEc:eee:finana:v:91:y:2024:i:c:s1057521923004921
    DOI: 10.1016/j.irfa.2023.102976
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    More about this item

    Keywords

    Air pollution; Toxic emissions; Inventor; Innovation;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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