Air Pollution and the Labor Market: Evidence from Wildfire Smoke

Mark Borgschulte, David Molitor and Eric Zou

No 15373, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We study how air pollution impacts the U.S. labor market by analyzing effects of drifting wildfire smoke that can affect populations far from the fires themselves. We link satellite smoke plume with labor market outcomes to estimate that an additional day of smoke exposure reduces quarterly earnings by about 0.1 percent. Extensive margin responses, including employment reductions and labor force exits, can explain 13 percent of the overall earnings losses. The implied welfare cost of lost earnings due to air pollution exposure is on par with standard valuations of the mortality burden. The findings suggest that labor market channels warrant greater consideration in policy responses to air pollution.

Keywords: air pollution; labor market; wildfires (search for similar items in EconPapers)
JEL-codes: J21 Q51 Q52 Q53 Q54 (search for similar items in EconPapers)
Pages: 57 pages
Date: 2022-06
New Economics Papers: this item is included in nep-ene, nep-env, nep-hea, nep-lma and nep-res
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (26)

Published - published in: Review of Economics and Statistics, 2024, 106 (6), 1558–1575.

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Related works:
Journal Article: Air Pollution and the Labor Market: Evidence from Wildfire Smoke (2024)
Working Paper: Air Pollution and the Labor Market: Evidence from Wildfire Smoke (2022)
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