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Clean air as an experience good in urban China

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  • Kahn, Matthew E.
  • Sun, Weizeng
  • Zheng, Siqi

Abstract

The surprise economic shutdown due to COVID-19 caused a sharp improvement in urban air quality in many previously heavily polluted Chinese cities. If clean air is a valued experience good, then this short-term reduction in pollution in spring 2020 could have persistent medium-term effects on reducing urban pollution levels as cities adopt new “blue sky” regulations to maintain recent pollution progress. We document that China's cross-city Environmental Kuznets Curve shifts as a function of a city's demand for clean air. We rank 144 cities in China based on their population's baseline sensitivity to air pollution and with respect to their recent air pollution gains due to the COVID shutdown. The largest experience good effect should take place for cities featuring a high pollution sensitive population and where air quality has sharply improved during the pandemic. The residents of these cities have increased their online discussions focused on environmental protection, and local officials are incorporating “green” industrial subsidies into post-COVID stimulus policies.

Suggested Citation

  • Kahn, Matthew E. & Sun, Weizeng & Zheng, Siqi, 2022. "Clean air as an experience good in urban China," Ecological Economics, Elsevier, vol. 192(C).
    • Handle: RePEc:eee:ecolec:v:192:y:2022:i:c:s092180092100313x
    DOI: 10.1016/j.ecolecon.2021.107254
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    2. Lee, Munseob & Finerman, Rachel, 2021. "COVID-19, commuting flows, and air quality," Journal of Asian Economics, Elsevier, vol. 77(C).
    3. Haider Mahmood & Maham Furqan & Muhammad Shahid Hassan & Soumen Rej, 2023. "The Environmental Kuznets Curve (EKC) Hypothesis in China: A Review," Sustainability, MDPI, vol. 15(7), pages 1-32, April.
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    5. Lin, Weiran & He, Qiuqin & Xiao, Yuan & Yang, Jingwen, 2023. "Do city lockdowns effectively reduce air pollution?," Technological Forecasting and Social Change, Elsevier, vol. 197(C).
    6. Xuan Tian & Cheng Zhang & Bing Xu, 2022. "The Impact of Air Pollution on Residents’ Happiness: A Study on the Moderating Effect Based on Pollution Sensitivity," IJERPH, MDPI, vol. 19(12), pages 1-20, June.
    7. Liu, Pihui & Han, Chuanfeng & Teng, Minmin, 2022. "Does clean cooking energy improve mental health? Evidence from China," Energy Policy, Elsevier, vol. 166(C).
    8. Lai, Wangyang & Song, Hong & Wang, Chang & Wang, Huanhuan, 2021. "Air pollution and brain drain: Evidence from college graduates in China," China Economic Review, Elsevier, vol. 68(C).
    9. Dou Xiangsheng & Ishaq Fizza, 2023. "Regional Environment Risk Assessment Over Space and Time: A Case of China," Economics - The Open-Access, Open-Assessment Journal, De Gruyter, vol. 17(1), pages 1-19.
    10. Penghu Zhu & Boqiang Lin, 2022. "Vanishing Happiness: How Does Pollution Information Disclosure Affect Life Satisfaction?," IJERPH, MDPI, vol. 19(15), pages 1-19, August.
    11. Nina Boogen & Massimo Filippini & Adan L. Martinez-Cruz, 2022. "Value of co-benefits from energy saving ventilation systems—Contingent valuations on Swiss home owners," CER-ETH Economics working paper series 22/368, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    12. 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).
    13. Burani, Nadia & Mantovani, Andrea, 2024. "Environmental policies with green network effect and price discrimination," TSE Working Papers 24-1513, Toulouse School of Economics (TSE), revised Jul 2024.
    14. Liu, Haiyue & Wang, Yile & Shi, Xiaoshuang & Pang, Lina, 2022. "How do environmental policies affect capital market reactions? Evidence from China's construction waste treatment policy," Ecological Economics, Elsevier, vol. 198(C).

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    More about this item

    Keywords

    China; Pollution progress; COVID-19; Experience goods; Regulation;
    All these keywords.

    JEL classification:

    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling

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