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Causal effect of aviation on air pollution: An instrumental variable from faraway COVID-19 restrictions in China

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  • Li, Jianglong
  • Gao, Jinfeng
  • Ho, Mun Sing

Abstract

The causal impacts of aviation on local air pollution are poorly understood. Leveraging variation in aviation frequency caused by COVID-19 travel restrictions that occurred hundreds of miles away between 2020 and 2022, this study identifies the short-run effect of aviation on air pollution in Hangzhou, a Chinese megacity. The results demonstrate that a one standard deviation change in aviation is associated with 12% to 21.82% changes in ambient pollution concentrations, with even more substantial pollution effects on downwind days and flights departing from Hangzhou, respectively. These estimates also remain robust to alternative specifications, satisfy external validity beyond Hangzhou and the epidemic period, and exclude pollution spillover effects. We further quantify the welfare losses from aviation pollution and find that people are willing to pay 1.76 US dollars a day in per capita household income for reducing pollution caused by each standard deviation increase in flights (i.e., 134 flights). Further analysis reveals higher economic losses resulting from pollutants at international airports. Our results underscore the need to regulate airborne contaminants from aviation in China urgently.

Suggested Citation

  • Li, Jianglong & Gao, Jinfeng & Ho, Mun Sing, 2024. "Causal effect of aviation on air pollution: An instrumental variable from faraway COVID-19 restrictions in China," China Economic Review, Elsevier, vol. 84(C).
    • Handle: RePEc:eee:chieco:v:84:y:2024:i:c:s1043951x24000294
    DOI: 10.1016/j.chieco.2024.102140
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