Welfare Losses from Wildfire Smoke: Evidence from Daily Outdoor Recreation Data

Wildfire smoke pollution is growing in the western United States. Estimates of its health impacts are numerous, but few revealed preference estimates of its damages exist. We study a setting where individuals are directly exposed to smoke, and avoidance behavior is measured with high frequency: outdoor recreation. We combine millions of administrative campground reservation records with satellite data on wildfire, smoke, and air pollution. These data are rich among most studies of recreation, with nearly 1,000 campgrounds and detailed individual-level observations. The data allow us to model sequential recreation decisions under evolving information using a novel control function approach. We estimate that wildfire smoke reduces welfare by $107 per person per trip. Damages are larger when campgrounds are affected by consecutive days of smoke and attenuated when smoke events are sufficiently far from active fires. In total, 21.5 million outdoor recreation visits in the western United States are affected by wildfire smoke every year, with annual welfare losses of approximately $2.3 billion. These findings contribute to a growing body of evidence on the costs of wildfire smoke.