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The impact of income inequality on haze pollution and health damage in China: A spatial econometrics perspective

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  • Wang, Feng
  • Shi, Dongjie
  • He, Jingze

Abstract

This paper assesses the impact of income inequality on haze pollution and health damage in China with the Generalized Spatial Two-Stage Least Squares and the Value of a Statistical Life method. Using a panel dataset of 205 Chinese cities from 2010 to 2019, we demonstrate a positive relationship between income inequality and environmental pollution, in which a 0.1 decrease in the Gini coefficient is associated with a 6.65 % decline in the annual average PM2.5 concentration. Growing income disparity is correlated with increased haze pollution by stifling technological innovation and reducing clean energy consumption. Benefit analysis reveals that the health damage from haze pollution decreases per capita life expectancy by 0.28 years for every 0.1 increase in the Gini coefficient and at least ¥192.98 billion RMB in economic losses (¥100.12 billion–¥285.84 billion RMB with a 95 % confidence interval). Our research reveals that implementing more equitable income distribution policies will alleviate environmental pollution.

Suggested Citation

  • Wang, Feng & Shi, Dongjie & He, Jingze, 2026. "The impact of income inequality on haze pollution and health damage in China: A spatial econometrics perspective," Economic Analysis and Policy, Elsevier, vol. 90(C), pages 17-37.
    • Handle: RePEc:eee:ecanpo:v:90:y:2026:i:c:p:17-37
    DOI: 10.1016/j.eap.2026.01.013
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