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

Muzhe Yang and Shin-Yi Chou

Journal of Environmental Economics and Management, 2018, vol. 90, issue C, 269-293

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.

Keywords: Environmental free riding; Power plants; Downwind; Fetal health (search for similar items in EconPapers)
JEL-codes: I18 Q53 Q58 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (28)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeeman:v:90:y:2018:i:c:p:269-293

DOI: 10.1016/j.jeem.2018.05.005

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