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The Morbidity Costs of Air Pollution: Evidence from Health Spending in China

[Published]: 2020-11-09[Source]: [Browsing]:

Speaker:XinZhang(Lecturer,School of Statistics,Beijing Normal University,Beijing, China)

Description:This paper is among the first to estimate the morbidity costs of fine particulates (PM2.5) for all the age cohorts in a developing country using individual-level health spending data taken from the Basic Medical Insurance Program in Wuhan, China. We use thermal inversion as an instrumental variable to address potential endogeneity in PM2.5 concentrations. Our analysis shows that PM2.5 has a significant impact on medical expenditures in both the short and long terms. The instrumental variable estimate suggests that a 10 μg/m3 reduction in PM2.5 per month leads to a 2.79% decrease in the value of health spending and a 0.70% decrease in the number of hospital visits and pharmacy purchases. The effect is more salient for males, the young (5 years and below), and the old (age 51 and above). Our estimates provide a lower bound of people’s willingness to pay, which amounts to 51.85 Chinese yuan for a 10 μg/m3 reduction in PM2.5 per capita per year.

Time:Nov11, 2020(Wednesday),14:00-17:00

Venue:Tencent meeting RoomID:257 519 704