Tradeoff between air pollution and economic benefits in migration dynamics: Evidence from China

Zhiqing Liu, Haitao Yin and Xuemei Zhang

Structural Change and Economic Dynamics, 2024, vol. 71, issue C, 669-679

Abstract: This paper investigates how environmental amenity and economic benefits are balanced in migration dynamics from the individual perspective. We construct a structural model based on the dataset that combines PM2.5 concentration data from NASA and migration information from the China Migration Dynamic Survey (CMDS). Thermal inversion is used as a source of exogenous shock in air pollution to address the omitted variable bias. The results indicate that if the ambient concentration of PM2.5 at destinations increases 1 μg/m3, the probability of migration at the individual level will decrease by 0.90 %. A battery of robustness checks is implemented, including different approaches to measuring migration decision, using imputed wage instead of disposable income, using different IV and proxy variable. Heterogeneity analysis reveals that the deterrence effect of air pollution is more pronounced for the following groups: migrants who are male, move from a rural residence, or to a coastal destination, belong to working-age population, engage in a tertiary industry, have a postgraduate-level education, and support two or more elders.

Keywords: Migration probability; PM2.5 ambient concentration; Floating population; Willingness to pay (search for similar items in EconPapers)
JEL-codes: O15 Q53 Q56 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:streco:v:71:y:2024:i:c:p:669-679

DOI: 10.1016/j.strueco.2024.09.010

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