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The impact of environmental regulation on fetal health: Evidence from the shutdown of a coal-fired power plant located upwind of New Jersey

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  • Yang, Muzhe
  • Chou, Shin-Yi

Abstract

Our study examines a case where cross-border air pollution had not been effectively dealt with by a decentralized, state level policymaking, letting a coal-fired power plant located on the border between two states pollute the downwind state for years without being controlled. We find that the shutdown of the power plant, thanks to a landmark ruling by the federal government, reduces the likelihoods of having a low birth weight baby and having a preterm birth by 15 percent and 28 percent, respectively, in areas downwind of the power plant. The ruling marks the first-ever federal level regulation under the Clean Air Act that overrides state-level regulations and is directly imposed upon a single pollution source. Our empirical setting emphasizes the importance of such regulation in curbing environmental free riding induced by jurisdictional borders, where pollution cost-shifting can be aided by natural forces such as prevailing winds.

Suggested Citation

  • Yang, Muzhe & Chou, Shin-Yi, 2018. "The impact of environmental regulation on fetal health: Evidence from the shutdown of a coal-fired power plant located upwind of New Jersey," Journal of Environmental Economics and Management, Elsevier, vol. 90(C), pages 269-293.
    • Handle: RePEc:eee:jeeman:v:90:y:2018:i:c:p:269-293
    DOI: 10.1016/j.jeem.2018.05.005
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    References listed on IDEAS

    as
    1. Muzhe Yang & Rhea A. Bhatta & Shin‐Yi Chou & Cheng‐I Hsieh, 2017. "The Impact of Prenatal Exposure to Power Plant Emissions on Birth Weight: Evidence from a Pennsylvania Power Plant Located Upwind of New Jersey," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 36(3), pages 557-583, June.
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    3. James E. Monogan & David M. Konisky & Neal D. Woods, 2017. "Gone with the Wind: Federalism and the Strategic Location of Air Polluters," American Journal of Political Science, John Wiley & Sons, vol. 61(2), pages 257-270, April.
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    8. Janet Currie & Maya Rossin‐Slater, 2015. "Early‐Life Origins of Life‐Cycle Well‐Being: Research and Policy Implications," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 34(1), pages 208-242, January.
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    2. Usha Dahal & Triin Veber & Daniel Oudin Åström & Tanel Tamm & Leena Albreht & Erik Teinemaa & Kati Orru & Hans Orru, 2022. "Perinatal Health Inequalities in the Industrial Region of Estonia: A Birth Registry-Based Study," IJERPH, MDPI, vol. 19(18), pages 1-17, September.
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    8. Xiaojing Jia & Xin Luo, 2023. "Residents’ Health Effect of Environmental Regulations in Coal-Dependent Industries: Empirical Evidence from China’s Cement Industry," Sustainability, MDPI, vol. 15(3), pages 1-16, January.
    9. Komisarow, Sarah & Pakhtigian, Emily L., 2022. "Are power plant closures a breath of fresh air? Local air quality and school absences," Journal of Environmental Economics and Management, Elsevier, vol. 112(C).
    10. Laura M. Argys & Susan L. Averett & Muzhe Yang, 2021. "Light pollution, sleep deprivation, and infant health at birth," Southern Economic Journal, John Wiley & Sons, vol. 87(3), pages 849-888, January.
    11. Dede Long & David Lewis & Christian Langpap, 2021. "Negative Traffic Externalities and Infant Health: The Role of Income Heterogeneity and Residential Sorting," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 80(3), pages 637-674, November.
    12. Akinyemi, Taiwo & Jung, Suhyun, 2023. "Power Plants and Child Mortality in Nigeria," 2023 Annual Meeting, July 23-25, Washington D.C. 335962, Agricultural and Applied Economics Association.
    13. Pullabhotla, Hemant K. & Souza, Mateus, 2022. "Air pollution from agricultural fires increases hypertension risk," Journal of Environmental Economics and Management, Elsevier, vol. 115(C).
    14. Argys, Laura M. & Averett, Susan L. & Yang, Muzhe, 2018. "Light Pollution, Sleep Deprivation, and Infant Health at Birth," IZA Discussion Papers 11703, Institute of Labor Economics (IZA).
    15. Alessandro Palma & Inna Petrunyk & Daniela Vuri, 2022. "Prenatal air pollution exposure and neonatal health," Health Economics, John Wiley & Sons, Ltd., vol. 31(5), pages 729-759, May.
    16. Hongshan Ai & Xiaoqing Tan & Zhen Xia, 2022. "RETRACTED: The Effects of Environmental Regulations on Medical Expenses: Evidence from China," IJERPH, MDPI, vol. 19(13), pages 1, June.
    17. Xiaojia Chen & Yuanfen Li & Yue Chen & Wei Xu, 2022. "Effects of Decentralized Water Regulation on Agriculture in China: A Quasi-Natural Experiment Based on Incentives for Promoting Officials," Sustainability, MDPI, vol. 15(1), pages 1-16, December.
    18. Ohler, Adrienne, 2023. "The Economics of Environmental Health Disparities: Who Benefits from Coal Power Plant Closures?," 2023 Annual Meeting, July 23-25, Washington D.C. 335760, Agricultural and Applied Economics Association.

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    More about this item

    Keywords

    Environmental free riding; Power plants; Downwind; Fetal health;
    All these keywords.

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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