Devil particles: Air pollution and safety liability accidents

This study empirically investigates the causal effect of air pollution on safety liability accidents. Based on the China Stock Market & Accounting Research (CSMAR) database, we compiled detailed information on 5873 safety liability accidents that occurred in China between 2000 and 2020. Using thermal inversions as an instrumental variable and applying a two-stage least squares (2SLS) regression model, our analysis reveals a significant positive impact of air pollution on safety liability accidents. Specifically, a doubling of PM2.5 concentration is associated with approximately a 2.6-fold increase in the probability of safety liability accidents, a 37 % rise in fatalities, and a 51 % increase in total casualties. This effect is particularly pronounced in energy-intensive industries such as coal mining and construction. Further cost estimation suggests that safety liability accidents caused by a doubling of PM2.5 concentration may result in social and economic losses ranging from approximately 4.92 billion to 10.1 billion USD. Mechanism analysis suggests that air pollution may significantly increase the risk of safety liability accidents through multiple pathways, including prolonged exposure duration, altered production behaviors, immediate environmental disruptions, and adverse effects on workers' physical and mental health.