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Energy aid, environmental risk, and household health effects

Author

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  • Liu, Yang
  • Jamasb, Tooraj
  • Dong, Kangyin
  • Nepal, Rabindra
  • Zhao, Congyu

Abstract

This study examines the health impacts of energy aid, a topic that has received limited attention compared to its environmental and energy-related effects. Using an unbalanced panel dataset, we identify an inverted U-shaped relationship between energy aid and household health loss, with benefits emerging only after aid exceeds a turning point. The effects differ by aid type, source, and recipient characteristics. Among all categories, only energy policy aid has an inverted U-shaped effect on household health losses. Aid from non-DAC donors (including non-DAC countries, private donors, and multilateral organizations) follows an inverted U-shaped pattern, while aid from DAC countries shows no clear relationship. Furthermore, the impact of energy aid also varies across demographic groups, including age, gender, and income levels. For example, children experience health benefits earlier than adults. We also find a threshold effect of government quality. Only when government quality exceeds the threshold does energy aid reduce health loss. These findings suggest that improving the continuity and equity of aid and strengthening governance in recipient countries are key to enhancing the health impact of energy aid.

Suggested Citation

  • Liu, Yang & Jamasb, Tooraj & Dong, Kangyin & Nepal, Rabindra & Zhao, Congyu, 2026. "Energy aid, environmental risk, and household health effects," Economic Modelling, Elsevier, vol. 155(C).
    • Handle: RePEc:eee:ecmode:v:155:y:2026:i:c:s0264999325003839
    DOI: 10.1016/j.econmod.2025.107388
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    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • F35 - International Economics - - International Finance - - - Foreign Aid
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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