American Economic Journal:
Economic Policy
ISSN 1945-7731 (Print) | ISSN 1945-774X (Online)
Clean Identification? The Effects of the Clean Air Act on Air Pollution, Exposure Disparities, and House Prices
American Economic Journal: Economic Policy
vol. 17,
no. 1, February 2025
(pp. 1–36)
Abstract
We assess the US Clean Air Act standards for fine particulate matter (PM2.5). Using high-resolution data, we find that the 2005 regulation reduced PM2.5 levels by 0.4 μg/ m3 over five years, with larger effects in more polluted areas. Standard difference-in-differences overstates these effects by a factor of three because time trends differ by baseline pollution, a bias we overcome with three alternative approaches. We show that the regulation contributed to narrowing Urban-Rural and Black-White PM2.5 exposure disparities, but less than difference-in-differences suggest. Pollution damages capitalized into house prices, however, appear larger than previously thought when leveraging regulatory variation.Citation
Sager, Lutz, and Gregor Singer. 2025. "Clean Identification? The Effects of the Clean Air Act on Air Pollution, Exposure Disparities, and House Prices." American Economic Journal: Economic Policy 17 (1): 1–36. DOI: 10.1257/pol.20220745Additional Materials
JEL Classification
- D63 Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- K32 Environmental, Energy, Health, and Safety Law
- Q52 Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
- Q53 Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
- Q58 Environmental Economics: Government Policy
- R31 Housing Supply and Markets
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