The impact of congestion pricing policies on primary school students’ performance: individual-level evidence from Milan’s Area C

Congestion pricing policies have been implemented in several cities to reduce traffic congestion and mitigate environmental impacts in urban areas. However, the externalities of such policies may extend beyond traffic reduction, potentially generating indirect effects on health and, consequently, on children’s educational outcomes. This study examines the impact of the congestion policy Area C introduced in Milan in 2012 on the academic performance of primary school pupils. Using a differencein- differences design and individual-level data from academic years 2009/2010 to 2018/2019, we analyze students’ outcomes across grades and subjects based on standardized tests from INVALSI. Our findings show statistically significant positive effects for second-grade students in both Mathematics and Italian, while no significant effects emerge for fifth-grade students. Moreover, the effects are heterogeneous across parental occupational backgrounds, with the largest gains observed among children from lower occupational backgrounds. Our results show that environmental regulation can generate meaningful equity-enhancing effects, narrowing early academic inequalities that mirror the socioeconomic structure of the city.