Matter and Energy
Accounting for Environmental Activity: Measuring Public Environmental Expenditures and the Environmental Goods and Services Sector in the US
Dennis Fixler et al.
NBER Working Paper, August 2023
Abstract:
How much of the economy is focused on protecting, rehabilitating, or managing the environment? To answer this question, we develop a proof-of-concept environmental activity account to quantify the environmental goods and services sector (EGSS) in the United States. Methodologically, we employ a satellite account approach similar to the method used by the US Bureau of Economic Analysis (BEA) to quantify other sectors of the economy (e.g., Outdoor Recreation Account, Marine Economy Account) while following the accounting principles and methods outlined in the SEEA Central Framework (SEEA-CF). This approach draws on detailed internal supply-use data, drawn primarily from Census's Industry and Product data along with other supplemental sources. Overall, we estimate gross output of the EGSS was $725 billion in 2019, or about 1.9% of the total gross output of the US economy. Government expenditures (across all levels) comprise a substantial portion of the EGSS in the US, as the public sector accounted for about 27% of total EGSS output ($197 billion) in 2019. Although these estimates are still preliminary and are not official statistics, the goals of this research are to provide new insights into classification and measurement challenges in producing environmental activity accounts more generally, while also documenting data gaps and accounting issues in the US context more specifically.
Empirical evidence of widespread exaggeration bias and selective reporting in ecology
Kaitlin Kimmel, Meghan Avolio & Paul Ferraro
Nature Ecology & Evolution, September 2023, Pages 1525-1536
Abstract:
In many scientific disciplines, common research practices have led to unreliable and exaggerated evidence about scientific phenomena. Here we describe some of these practices and quantify their pervasiveness in recent ecology publications in five popular journals. In an analysis of over 350 studies published between 2018 and 2020, we detect empirical evidence of exaggeration bias and selective reporting of statistically significant results. This evidence implies that the published effect sizes in ecology journals exaggerate the importance of the ecological relationships that they aim to quantify. An exaggerated evidence base hinders the ability of empirical ecology to reliably contribute to science, policy, and management. To increase the credibility of ecology research, we describe a set of actions that ecologists should take, including changes to scientific norms about what high-quality ecology looks like and expectations about what high-quality studies can deliver.
Information, awareness, and mental health: Evidence from air pollution disclosure in China
Tingting Xie, Ye Yuan & Hui Zhang
Journal of Environmental Economics and Management, July 2023
Abstract:
This paper assesses mental health responses to information on environmental risks. We exploit the progressive implementation of a national program in China that introduces more comprehensive air pollution monitoring and provides real-time air-pollution information to the public. The program leads to a sharp increase in public awareness and attention to air pollution issues and results in a large increase in the sensitivity of individual's mental health to changes in air quality, especially among those with more exposure to pollution information and those more susceptible to mental illnesses. Information of worsening air quality has a direct effect on mental health as a source of stressors and an indirect behavioral effect through reducing outdoor activities and social integration. Our findings shed light on the design and delivery of environmental information disclosure programs, especially for countries with pressing environmental threats.
The electoral consequences of environmental accidents: Evidence from Chernobyl
Adrian Mehic
Journal of Public Economics, September 2023
Abstract:
This paper examines the relationship between environmental accidents and voting. Following the 1986 Chernobyl disaster, environmentalist parties entered parliaments in several nations. This paper uses Chernobyl as a natural experiment creating variation in radioactive fallout exposure over Sweden. I match municipality-level data on cesium ground contamination with election results for the environmentalist Green Party, which was elected to parliament in 1988. After adjusting for pre-Chernobyl views on nuclear power, the results show that voters in high-fallout areas were more likely to vote for the Greens. Detailed individual-level survey data suggests that resistance to nuclear energy increased in fallout-effected areas after the accident, and that this change was driven by voters who followed local media closely.
Show Me the Money! Incentives and Nudges to Shift Electric Vehicle Charge Timing
Megan Bailey et al.
NBER Working Paper, August 2023
Abstract:
We use a field experiment to measure the effectiveness of financial incentives and moral suasion "nudges" to shift the timing of electric vehicle (EV) charging. We find EV owners respond strongly to financial incentives, while nudges have no statistically discernible effect. When financial incentives are removed, charge timing reverts to pre-intervention behavior, showing no evidence of habit formation and reinforcing our finding that "money matters". Our charge price responsiveness estimate is an order of magnitude larger than typical household electricity consumption elasticities. This result highlights the greater flexibility of EV charging over other forms of residential electricity demand.
Cleaner waters and urbanization
Qianping Ren & Jeremy West
Journal of Environmental Economics and Management, October 2023
Abstract:
The Clean Water Act (CWA) addresses nonpoint source pollution primarily by funding public works projects. Our study evaluates changes in rural watersheds before and after CWA projects are implemented, compared to watersheds without funding. We find that projects significantly reduce water pollution, with corresponding increases in human population and residential construction. Using housing values, we estimate that economic benefits exceed government costs by at least fourfold. Over half of this benefit is attributable to new housing. Our findings show that pollution can impede urbanization, suggesting more broadly that residential development is an important mechanism of revealed preference for environmental quality.
Tax Credits for Clean Electricity: The Distributional Impacts of Supply-Push Policies in the Power Sector
Maxwell Brown et al.
NBER Working Paper, August 2023
Abstract:
We evaluate distributional and efficiency consequences of the bulk power clean electricity tax credits authorized by the 2022 Inflation Reduction Act. To do so, we link detailed electricity capacity expansion, computable general equilibrium, data-rich microsimulation, and air pollution models to estimate the policy incidence in terms of economic welfare and health impacts across a wide range of demographic groups. We evaluate the tradeoff between policy efficiency and income progressivity by comparing the tax credits to cap-and-trade policies that vary revenue recycling approaches. Under the scenarios analyzed the bulk power tax credits lead to increased clean electricity technology deployment resulting in a reallocation of capital from elsewhere in the economy, higher prices for capital and other goods, lower power prices, and lower emissions. The tax credits yield progressive outcomes for both economic welfare and health impacts. The health benefits exceed total policy costs and provide greater benefits for low-income and historically-marginalized households given the coincidence of household and emission source locations.
Air Pollution and Rent Prices: Evidence from Wildfire Smoke
Luis Lopez & Nitzan Tzur-Ilan
Federal Reserve Working Paper, August 2023
Abstract:
We analyze the causal effect of air pollution exposure (PM2.5) on rent and house prices, using quasi-experimental exposures to wildfire smoke shocks. We link satellite-based smoke plume data with ambient air pollution data from the EPA's Air Quality System, and unique rental contracts in the Las Vegas Realtors' (LVR) multiple listing service (MLS). Our results indicate that although Las Vegas is not directly affected by wildfires, those fires increase air pollution in the city, causing a decline in rents by about 0.7% per unit increase in PM2.5. Overall, reducing the average pollution level in Las Vegas by 50% is valued at $5.67 billion.
Air pollution and suicide in rural and urban America: Evidence from wildfire smoke
David Molitor, Jamie Mullins & Corey White
Proceedings of the National Academy of Sciences, 19 September 2023
Abstract:
Air pollution poses well-established risks to physical health, but little is known about its effects on mental health. We study the relationship between wildfire smoke exposure and suicide risk in the United States in 2007 to 2019 using data on all deaths by suicide and satellite-based measures of wildfire smoke and ambient fine particulate matter (PM2.5) concentrations. We identify the causal effects of wildfire smoke pollution on suicide by relating year-over-year fluctuations in county-level monthly smoke exposure to fluctuations in suicide rates and compare the effects across local areas and demographic groups that differ considerably in their baseline suicide risk. In rural counties, an additional day of smoke increases monthly mean PM2.5 by 0.41 μg/m3 and suicide deaths by 0.11 per million residents, such that a 1-μg/m3 (13%) increase in monthly wildfire-derived fine particulate matter leads to 0.27 additional suicide deaths per million residents (a 2.0% increase). These effects are concentrated among demographic groups with both high baseline suicide risk and high exposure to outdoor air: men, working-age adults, non-Hispanic Whites, and adults with no college education. By contrast, we find no evidence that smoke pollution increases suicide risk among any urban demographic group. This study provides large-scale evidence that air pollution elevates the risk of suicide, disproportionately so among rural populations.
Drinking Water Contaminant Concentrations and Birth Outcomes
Elaine Hill & Richard DiSalvo
NBER Working Paper, August 2023
Abstract:
Previous research in the US has found negative health effects of contamination when it triggers regulatory violations. An important question is whether levels of contamination that do not trigger a health-based violation impact health. We study the impact of drinking water contamination in community water systems on birth outcomes using drinking water sampling results data in Pennsylvania. We create an overall water quality index and an index specific to reproductive health. We focus on the effects of water contamination for births not exposed to regulatory violations. Our most rigorous specification employs mother fixed effects and finds changing from the 10th to the 90th percentile of water contamination (among births not exposed to regulatory violations) increases low birth weight by 12% and preterm birth by 17%.
Testing Above the Limit: Drinking Water Contamination and Test Scores
Michelle Marcus
NBER Working Paper, August 2023
Abstract:
This paper provides the first estimates of the contemporaneous effect of drinking water quality violations on students' academic achievement. Using student-level test score data with residential addresses, geographic information on water systems, and drinking water violations from North Carolina, I estimate the within-student impacts of poor water quality on student test scores. Exposure to a bacteria violation during the school year decreases math scores by about 0.037 standard deviations when the public is uninformed. Results suggest that poor water quality may impact retention or comprehension of material throughout the school year.