Migratory Responses to Air Pollution Reduction: Evidence from Large-scale Desulfurization Programme

This paper examines how improvements in air quality affect migration behavior. We exploit a natural experiment in the Czech Republic, where rapid desulfurization of coal-fired power plants in the 1990s led to a sharp reduction in SO2 pollution - from extremely high levels to below EU/WHO limits - without directly impacting economic activity. Using a difference-in-differences approach, we find that cleaner air reduced emigration from previously heavily polluted municipalities by 24% and increased net migration by 78%, with effects strongest in the most polluted areas. The impact was particularly pronounced among highly educated individuals. Migration responses were strongest in municipalities with weaker social capital and fewer public amenities, suggesting that environmental improvements matter most where other local advantages are limited. In contrast, anti-emigration monetary subsidies-such as those offered during the socialist period in polluted areas-had no effect. Overall, our findings highlight the potential of environmental policies to support re-population and regional revitalization-especially when combined with investments in infrastructure and public services.