This website uses cookies.

By clicking the "Accept" button or continuing to browse our site, you agree to first-party and session-only cookies being stored on your device to enhance site navigation and analyze site performance and traffic. For more information on our use of cookies, please see our Privacy Policy.

  1. Home
  2. ASSA Annual Meeting
  3. 2021
  4. Preliminary Program
  5. Air Quality and Behaviors
« Back to Results

Air Quality and Behaviors

Paper Session

Tuesday, Jan. 5, 2021 12:15 PM - 2:15 PM (EST)

Hosted By: Association of Environmental and Resource Economists
  • Chair: Fernando Aragon, Simon Frasier University

Natural Gas Flaring, Respiratory Health, and Distributional Effects

Wesley Blundell
,
Washington State University
Anatolii Kokoza
,
USAA

Abstract

Since 2008 the United States has experienced tremendous growth in oil production as a result of shale development through hydraulic fracturing. In addition to oil, the shale rock contains various combustible gases, including natural gas together with other impurities. Because it is costly to capture, transport and process, this natural gas is often burned at the well in a process called flaring.
Flaring results in local air pollution that is detrimental to local health outcomes. Recently, state and federal policymakers have been divided over whether and to what extent to allow flaring. In this paper, we provide evidence of a causal link between the flaring of natural gas and human health. We take advantage of a unique dataset on well locations, flaring, weather, natural gas processing facilities, and patient-level hospital visits with the five digit zip and diagnostic codes for each patient in North Dakota.
Using an instrumental variables design, we estimate the impact of upwind flaring on the rate of respiratory related hospital visits for a zip code. We estimate that a one percent increase in upwind flaring causes a 0.0012 (0.7%) increase in the rate of respiratory related hospital visits downwind. This estimate indicates that if an 80% gas capture rate had been in place prior to 2007, health costs from respiratory related hospital visits in North Dakota would have been reduced by $158.4 million over a nine year period. We further find that zip codes exposed to more than half of all flared natural gas extracted less than 14.3% of all resource wealth. These results inform current policy debates on the benefits of restrictions on flaring, the externalities associated with shale development, and the distribution of those externalities.

Wildfires, Smoke, and Outdoor Recreation in the Western United States

Jacob Gellman
,
University of California-Santa Barbara
Margaret Walls
,
Resources for the Future
Matthew Wibbenmeyer
,
Resources for the Future

Abstract

Outdoor recreation on public lands has increased in popularity in recent years, particularly in the western US. At the same time, the prevalence of wildfires in the region is on the rise. In many areas, wildfire season overlaps with peak outdoor recreation season. In this study, we combine daily observational data on outdoor recreation over a ten-year period across the western continental US with daily data on wildfire burn areas and smoke plumes to assess the impact of wildfires and smoke on recreation.
Our recreation data are daily campground reservation data collected from Recreation.gov, a website and reservation management system through which campers make reservations to approximately 3,700 federally-managed campgrounds across the US. Our data set includes 25 million transactions from more than 3 million unique users over a ten-year period. We aggregate daily camping reservation records by campground and use panel fixed effects regressions to estimate effects of wildfire and smoke conditions on new reservations, cancellations, and campground occupancy.
We find statistically significant effects of smoke and fire on campground use, but the magnitudes of the effects are relatively small. For example, on days with nearby wildfires, campground occupancy declines by 6 percentage points, on average, and the number of reservation cancellations increases by 25 percent in the week leading up to arrival. The presence of smoke reduces campground occupancy rates by only 1.4 percentage points, on average, and increases cancellations by 4 percent. The lack of sizeable averting behavior means that a substantial number of campers are affected by fire and smoke. We calculate that 1.5 million camping visitor-days per year, on average, were under smoke plumes during our sample period, 17 percent of all camping visitor-days in the West.

Wildfires, Smoky Days and Labor Supply

H. Ron Chan
,
University of Manchester
Martino Pelli
,
University of Sherbrooke
Veronica Vienne Arancibia
,
University of Manchester

Abstract

Air pollution affects human activities through a variety of channels, such as the ability to perform certain activities or overall well-being. In this paper we study the impact of air pollution on labor supply and complement other studies focusing on outcomes such as health or workers productivity. We focus on Chile, a developing country characterized by a high level of air pollution, and use the incidence of wildfires between 2010 and 2018 in order to generate exogenous variation in the level of air pollution. This exogenous variation in air pollution allows us to identify the causal impact of air pollution on labor supply and contribute to the literature that empirically estimates the economic costs of air pollution.
We gather remote sensing data on wildfires and wind direction in order to create a wildfire exposure index for each district in our sample. We adopt a reduced form approach to estimate the economic impact of experiencing an additional smoky day on the number of hours worked by each worker, based on the random assignment of the day of visit for the National Labor Survey and the exogenous occurrence of wildfires. We find that an extra smoky day leads to a 1% reduction in hours worked for the average Chilean worker. The impact is persistent, we find a significant reduction in hours worked during the two following weeks. The effect is more substantial for industries mainly involved in outdoor tasks, such as agriculture and construction, with reductions in the number of hours worked up to 5-7%. These results will allow us to back out the labor supply cost of wildfires and of air pollution.

Particulate Matter and Labor Supply: Evidence from Mexico City

Bridget Hoffmann
,
Inter-American Development Bank
Juan Pablo Rud
,
Royal Holloway University of London

Abstract

We study the short-term response of labor supply to particulate matter using daily variation in PM 2.5 and PM 10 at the locality-level in the metropolitan Mexico City during 2005-2016. We find consistent evidence that the relationship between particulate matter and daily hours worked and the probability of working that day are nonlinear. We utilize the World Health Organization’s Air Quality Guidelines (AQG) and Interim Targets (IT) 1, 2, and 3, with Interim Target 1 (AQG) representing the most (least) extreme levels of air pollution. For PM2.5, an additional hour above the AQG has no effect on same day hours worked but an additional hour about the IT 1 is associated with a 0.155 (9.3 minutes) reduction in same day hours worked. An additional hour above the PM2.5 AQG slightly increases the probability of working that day while an additional hour above the PM2.5 IT 1 decreases the probability of working that day by 1.8%. The results for PM10 follow a very similar pattern. We conduct falsification tests using reported usual hours worked and find no effects of PM2.5 or PM10 on usual hours worked or the probability of usually working that day. To corroborate our main results, we use wind direction and speed as instruments for particulate matter to overcome concerns associated with confounding factors and find consistent results. We look at the substitution of labor supply across days using lagged air pollution measures. We find that daily hours worked and the probability of working on a given day increase in response to high levels of PM2.5 and PM10 during the prior four days. However, consistent with results using data at the weekly level, the substitution of labor supply across days is not enough to fully compensate for the contemporaneous decrease in labor supply in response to air pollution.
Discussant(s)
Catie Hausman
,
University of Michigan
Jose Sanchez
,
U.S. Forest Service
Emily Pakhtigian
,
Duke University
Fernando Aragon
,
Simon Frasier University
JEL Classifications
  • Q5 - Environmental Economics