PFAS Exposure and Cognitive Development: Evidence from an Italian Environmental Incident

PFAS, highly persist chemicals widely used in manufacturing, are found in the blood of people and animals all over the world. While many studies associate PFAS exposure to adverse health and developmental effects in humans, there is currently no causal evidence on these associations. This paper exploits the largest European PFAS contamination incident to provide first-hand causal evidence on the relationship between water-borne PFAS exposure and cognitive development. For decades close to thirty municipalities in the Italian Veneto region were served PFAS-contaminated water by the local public water supplier. Potential exposure stopped only in 2013, when the incident was discovered. I identify the overall effect of PFAS pollution on academic performance exploiting the setup as a geographic quasi-experiment (GQE): children attending schools in contaminated municipalities perform at least 10% of a standard deviation below those studying in nearby schools. To identify intensive margin effects of the pollutant, I examine whether educational performance of contaminated students improves with PFAS blood decline in a continuous-treatment difference- indifferences (CDD) setup. CDD estimates are slightly lower than GQE estimates when using the same geographical restrictions, but twice as large when accounting for potential contamination spillovers. I conclude that PFAS exposure reduces academic performance by at least 27% of a standard deviation, with effects not confined to contaminated areas and largely driven by contemporaneous exposure, rather than permanent developmental shocks. Effects of PFAS exposure are strongest in the most polluted municipalities, and larger for young and disadvantaged students.