Year of Publication: 2010

Abstract: This study quantifies the impacts of air pollution and related regulations on infant mortality in China. To establish causality, I exploit plausibly exogenous variations in air quality generated by environmental regulations since 1995. These legislations imposed stringent regulations on pollutant emissions from power plants. The results suggest that the regulations led to significant reductions in air pollution and infant mortality rate (IMR). I estimate that 25,400 fewer infants died per year than would have died in the absence of the regulations, corresponding to about a 21 percent decline in IMR. The findings also reveal that infants from low socioeconomic families are more vulnerable to the effect of pollution. More importantly, the analysis highlights the important role of maternal exposure to pollution on fetal development. The instrumental variable estimates indicate that a one percent reduction in total suspended particulates results in a 0.95 percent reduction in IMR, whereas a one percent reduction in sulfur dioxide results in a 0.82 percent reduction in IMR. The estimated impact of a unit change in TSP is of similar magnitude to that found in the U.S., but the elasticity is substantially higher in China, highlighting the greater benefits associated with regulations when pollution is already quite high.