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Effectiveness, Spillovers, and Well-Being Effects of Driving Restriction Policies

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  • Luis Sarmiento
  • Nicole Wägner
  • Aleksandar Zaklan

Abstract

We study the effectiveness, spillovers, and well-being effects of low emission zones in Germany, an emission-intensity-based driving restriction rapidly growing in popularity. Using regression discontinuity and group-time difference-in-differences designs, we show that previous estimates of the policy’s impact on traffic-related air pollution significantly underestimate its effectiveness. We provide evidence of beneficial and harmful policy spillovers to neighboring areas, and increases in ozone due to changes in the chemical balance with precursor contaminants. Policy effects are heterogeneous by season, with greater decreases in traffic pollutants during winter and increases in ozone during spring and summer. Using individual-level data from the German Socio-Economic Panel, we further find that the policy decreases subjective well-being despite clear evidence of health benefits. The decline in well-being is especially pronounced in the first year after policy implementation and is transitory.

Suggested Citation

  • Luis Sarmiento & Nicole Wägner & Aleksandar Zaklan, 2021. "Effectiveness, Spillovers, and Well-Being Effects of Driving Restriction Policies," Discussion Papers of DIW Berlin 1947, DIW Berlin, German Institute for Economic Research.
    • Handle: RePEc:diw:diwwpp:dp1947
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    Cited by:

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    2. Gruhl, Henri & Volkhausen, Nicolas & Pestel, Nico & aus dem Moore, Nils, 2022. "Air pollution and the housing market: Evidence from Germany's Low Emission Zones," Ruhr Economic Papers 977, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.

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    More about this item

    Keywords

    Low emission zones; air pollution; well-being; health; group-time differencein-differences; regression discontinuity;
    All these keywords.

    JEL classification:

    • 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
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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