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The impact of environmental regulation on fetal health: Evidence from the shutdown of a coal-fired power plant located upwind of New Jersey

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  • Yang, Muzhe
  • Chou, Shin-Yi

Abstract

Our study examines a case where cross-border air pollution had not been effectively dealt with by a decentralized, state level policymaking, letting a coal-fired power plant located on the border between two states pollute the downwind state for years without being controlled. We find that the shutdown of the power plant, thanks to a landmark ruling by the federal government, reduces the likelihoods of having a low birth weight baby and having a preterm birth by 15 percent and 28 percent, respectively, in areas downwind of the power plant. The ruling marks the first-ever federal level regulation under the Clean Air Act that overrides state-level regulations and is directly imposed upon a single pollution source. Our empirical setting emphasizes the importance of such regulation in curbing environmental free riding induced by jurisdictional borders, where pollution cost-shifting can be aided by natural forces such as prevailing winds.

Suggested Citation

  • Yang, Muzhe & Chou, Shin-Yi, 2018. "The impact of environmental regulation on fetal health: Evidence from the shutdown of a coal-fired power plant located upwind of New Jersey," Journal of Environmental Economics and Management, Elsevier, vol. 90(C), pages 269-293.
    • Handle: RePEc:eee:jeeman:v:90:y:2018:i:c:p:269-293
    DOI: 10.1016/j.jeem.2018.05.005
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    as
    1. Muzhe Yang & Rhea A. Bhatta & Shin‐Yi Chou & Cheng‐I Hsieh, 2017. "The Impact of Prenatal Exposure to Power Plant Emissions on Birth Weight: Evidence from a Pennsylvania Power Plant Located Upwind of New Jersey," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 36(3), pages 557-583, June.
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    5. Argys, Laura M. & Averett, Susan L. & Yang, Muzhe, 2018. "Light Pollution, Sleep Deprivation, and Infant Health at Birth," IZA Discussion Papers 11703, Institute of Labor Economics (IZA).
    6. Shihe Fu & V. Brian Viard, 2022. "A mayors perspective on tackling air pollution," Chapters, in: Charles K.Y. Leung (ed.), Handbook of Real Estate and Macroeconomics, chapter 16, pages 413-437, Edward Elgar Publishing.
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    15. Hongshan Ai & Xiaoqing Tan, 2021. "A Literature Review of the Effects of Energy on Pollution and Health," Energy RESEARCH LETTERS, Asia-Pacific Applied Economics Association, vol. 2(4), pages 1-5.
    16. Li, Jianglong & Gao, Jinfeng & Liao, Meiling, 2024. "Operating risk of enterprises when adopting environmental regulation: Evidence from environmental protection law in China," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 901-914.
    17. 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).
    18. Adhvaryu, Achyuta & Molina, Teresa & Nyshadham, Anant & Tamayo, Jorge & Torres, Nicolas, 2023. "The health costs of dirty energy: Evidence from the capacity market in Colombia," Journal of Development Economics, Elsevier, vol. 164(C).
    19. DeCicca, Philip & Malak, Natalie, 2020. "When good fences aren’t enough: The impact of neighboring air pollution on infant health," Journal of Environmental Economics and Management, Elsevier, vol. 102(C).
    20. Laura M. Argys & Susan L. Averett & Muzhe Yang, 2021. "Light pollution, sleep deprivation, and infant health at birth," Southern Economic Journal, John Wiley & Sons, vol. 87(3), pages 849-888, January.
    21. Pullabhotla, Hemant K. & Souza, Mateus, 2022. "Air pollution from agricultural fires increases hypertension risk," Journal of Environmental Economics and Management, Elsevier, vol. 115(C).
    22. Hongshan Ai & Xiaoqing Tan & Zhen Xia, 2022. "RETRACTED: The Effects of Environmental Regulations on Medical Expenses: Evidence from China," IJERPH, MDPI, vol. 19(13), pages 1-17, June.
    23. Ai, Hongshan & Tan, Xiaoqing & Zhou, Shengwen & Zhou, Yuhan & Xing, Hongye, 2023. "The impact of environmental regulation on carbon emissions: Evidence from China," Economic Analysis and Policy, Elsevier, vol. 80(C), pages 1067-1079.

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    More about this item

    Keywords

    Environmental free riding; Power plants; Downwind; Fetal health;
    All these keywords.

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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