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Information, migration, and the value of clean air

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  • Gao, Xuwen
  • Song, Ran
  • Timmins, Christopher

Abstract

Using a variant of the Rosen-Roback model of inter-city migration that incorporates public access to air quality information, we demonstrate that information constraints create a wedge between revealed and true hedonic prices for pollution that depends upon individuals’ perception biases. We empirically test our theoretical predictions by leveraging the unexpected disclosure of PM2.5 data in China. We find that migration decisions become much more responsive to pollution and that the hedonic price of avoiding PM2.5 exposure nearly doubles – from 171 to 336 Chinese Yuan – in response to the information shock. Our results highlight the role of imperfect information in migration decisions and its impact on non-market valuation in countries where public access to information is restricted.

Suggested Citation

  • Gao, Xuwen & Song, Ran & Timmins, Christopher, 2023. "Information, migration, and the value of clean air," Journal of Development Economics, Elsevier, vol. 163(C).
    • Handle: RePEc:eee:deveco:v:163:y:2023:i:c:s0304387823000342
    DOI: 10.1016/j.jdeveco.2023.103079
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    Cited by:

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    5. Behrer,Arnold Patrick & Choudhary,Rishabh & Sharma,Dhruv, 2023. "Air Pollution Reduces Economic Activity: Evidence from India," Policy Research Working Paper Series 10515, The World Bank.
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    10. Peng, Guohua & Zhao, Xiaoling, 2025. "Effects of export growth on the location choices of migrant workers: Evidence from China," China Economic Review, Elsevier, vol. 92(C).
    11. Frohnweiler, Sarah & Beber, Bernd & Ebert, Cara, 2024. "Information frictions, belief updating and internal migration: Evidence from Ghana and Uganda," Journal of Development Economics, Elsevier, vol. 171(C).
    12. Brox, Enzo & Krieger, Tommy, 2025. "Far-right mass protests and their effects on internal migration," ZEW Discussion Papers 25-045, ZEW - Leibniz Centre for European Economic Research.
    13. Liu, Menglan & Shi, Jian-gang & Shen, Jianfu & Man Hui, Eddie Chi, 2025. "Are migrants willing to pay more for better housing? The amenity effect in China's urban housing markets," Socio-Economic Planning Sciences, Elsevier, vol. 100(C).
    14. Qian, Ruoyu, 2024. "Communist propaganda and women’s status," Journal of Development Economics, Elsevier, vol. 171(C).
    15. Frohnweiler, Sarah & Beber, Bernd & Ebert, Cara, 2024. "Information frictions, belief updating and internal migration: Evidence from Ghana and Uganda," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 171, pages 1-17.
    16. Wang, Kunlun & Yao, Hongjiang, 2024. "How environmental information is capitalized into the housing market? Evidence from China's National Ambient Air Quality Standards," China Economic Review, Elsevier, vol. 88(C).
    17. Daryl Fairweather & Matthew E. Kahn & Robert D. Metcalfe & Sebastian Sandoval Olascoaga, 2024. "Expecting Climate Change: A Nationwide Field Experiment in the Housing Market," NBER Working Papers 33119, National Bureau of Economic Research, Inc.

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    Keywords

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    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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