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From Fog to Smog: the Value of Pollution Information

Author

Listed:
  • Panle Jia Barwick
  • Shanjun Li
  • Liguo Lin
  • Eric Zou

Abstract

During 2013-2014, China launched a nationwide, real-time air quality monitoring and disclosure program, a watershed moment in the history of its environmental regulations. We present the first empirical analysis of this natural experiment by exploiting its staggered implementation across cities. The program has transformed the landscape of China’s environmental protection, substantially expanded public access to pollution information, and dramatically increased households’ awareness about pollution issues. These transformations, in turn, triggered a cascade of household behavioral changes, including increases in online searches for pollution-related topics, adjustments in day-to-day consumption patterns to avoid pollution exposure, and higher willingness to pay for housing in less polluted areas. As a result of both short- and long-term behavioral changes, the program significantly reduced the mortality impact of air pollution. Conservative estimates suggest that health benefits are at least one order of magnitude larger than the costs of the program and associated avoidance behaviors combined. Our findings highlight considerable benefits from improving access to pollution information in developing countries, many of which are experiencing the world’s worst air pollution but do not systematically collect or disseminate pollution information.

Suggested Citation

  • Panle Jia Barwick & Shanjun Li & Liguo Lin & Eric Zou, 2019. "From Fog to Smog: the Value of Pollution Information," NBER Working Papers 26541, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:26541
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Catherine Hausman & Samuel Stolper, 2020. "Inequality, Information Failures, and Air Pollution," NBER Working Papers 26682, National Bureau of Economic Research, Inc.
    2. Fan, Maoyong & He, Guojun & Zhou, Maigeng, 2020. "The winter choke: Coal-Fired heating, air pollution, and mortality in China," Journal of Health Economics, Elsevier, vol. 71(C).
    3. Youming Liu & Shanjun Li & Caixia Shen, 2020. "The Dynamic Efficiency in Resource Allocation: Evidence from Vehicle License Lotteries in Beijing," NBER Working Papers 26904, National Bureau of Economic Research, Inc.
    4. He, Guojun & Liu, Tong & Zhou, Maigeng, 2020. "Straw burning, PM2.5, and death: Evidence from China," Journal of Development Economics, Elsevier, vol. 145(C).
    5. Michael Greenstone & Guojun He & Ruixue Jia & Tong Liu, 2020. "Can Technology Solve the Principal-Agent Problem? Evidence from China’s War on Air Pollution," NBER Working Papers 27502, National Bureau of Economic Research, Inc.
    6. Pinchbeck, Edward W. & Roth, Sefi & Szumilo, Nikodem & Vanino, Enrico, 2020. "The Price of Indoor Air Pollution: Evidence from Radon Maps and the Housing Market," IZA Discussion Papers 13655, Institute of Labor Economics (IZA).
    7. Rhiannon Jerch & Panle Jia Barwick & Shanjun Li & Jing Wu, 2020. "Road Rationing Policies and Housing Markets," DETU Working Papers 2004, Department of Economics, Temple University.

    More about this item

    JEL classification:

    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
    • I10 - Health, Education, and Welfare - - Health - - - General
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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