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Environmental quality, human capital and growth

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  • Onur Sapci
  • Jason F. Shogren

Abstract

This study uses U.S. county-level pollution changes from 2007 to 2009 induced by the 2007–2009 recession to measure the impact of changes in air quality on human capital. The exogenous shocks to air quality are induced by a recession in manufacturing and construction sectors. This study compares the changes in human capital in counties that had large pollution reductions to the changes in human capital in counties with small pollution reductions while controlling for income changes and other heterogeneous trends across counties. We first present a motivating model to show how environmental degradation affects human capital investments through negative health effects. The model illustrates how poor environmental quality can slow economic growth due to negative impacts on human capital. Using an extensive panel data for U.S. counties, the empirical results show that a 1% reduction in pollution increases the human capital stock by 0.10%.

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  • Onur Sapci & Jason F. Shogren, 2018. "Environmental quality, human capital and growth," Journal of Environmental Economics and Policy, Taylor & Francis Journals, vol. 7(2), pages 184-203, April.
    • Handle: RePEc:taf:teepxx:v:7:y:2018:i:2:p:184-203
    DOI: 10.1080/21606544.2017.1384403
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    Cited by:

    1. Huiying Chen & Shuyan Gu & Cangcang Jia & Hai Gu & Qinglin Xu & Zi Lin, 2023. "Effects of Household Clean Fuel Combustion on the Physical and Mental Health of the Elderly in Rural China," Sustainability, MDPI, vol. 15(10), pages 1-19, May.
    2. Payab, Ahmad Haseeb & Kautish, Pradeep & Sharma, Rajesh & Siddiqui, Aaliyah & Mehta, Atul & Siddiqui, Mujahid, 2023. "Does human capital complement sustainable development goals? Evidence from leading carbon emitter countries," Utilities Policy, Elsevier, vol. 81(C).
    3. Borissov, Kirill & Brausmann, Alexandra & Bretschger, Lucas, 2019. "Carbon pricing, technology transition, and skill-based development," European Economic Review, Elsevier, vol. 118(C), pages 252-269.
    4. Priti Agarwal & Aparna Sawhney, 2021. "Sustainability and comprehensive wealth accounting: the case of India," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(3), pages 3762-3786, March.
    5. Koç, Pınar & Gülmez, Ahmet, 2021. "Analysis of relationships between nanotechnology applications, mineral saving and ecological footprint: Evidence from panel fourier cointegration and causality tests," Resources Policy, Elsevier, vol. 74(C).
    6. Osarumwense Osabuohien-Irabor & Igor Mikhailovich Drapkin, 2024. "The spillover effects of outward FDI on environmental sustainability in developing countries: exploring the channels of home country institutions and human capital," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(8), pages 20597-20627, August.
    7. Feng, Wei & Yuan, Hang, 2023. "The impact of medical infrastructure on regional innovation: An empirical analysis of China's prefecture-level cities," Technological Forecasting and Social Change, Elsevier, vol. 186(PA).

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