Reducing Disparities in Environmental Damages
Sunday, Jan. 3, 2021 10:00 AM - 12:00 PM (EST)
- Chair: Teevrat Garg, University of California-San Diego
Can Access to Health Care Mitigate the Effects of Temperature on Mortality?
AbstractUnderstanding the sources of heterogeneity in the health effects of environmental exposure is critical for optimal policy design. Differential access to health care is commonly cited as a potential source of such heterogeneity. We test this hypothesis in a causal framework by combining random year-to-year fluctuations in local temperatures with variation in access to primary care services resulting from the idiosyncratic roll-out of Community Health Centers (CHCs) across US counties in the 1960s and 1970s. We find that the improved access to primary care services provided by CHCs moderates the heat-mortality relationship by 14.2%, but we find little evidence that CHC access mitigates the harmful effects of cold. In a supplementary analysis we find evidence that acute care – in contrast to primary care – may be especially effective at mitigating the cold-mortality relationship. Our results suggest that differential access to health care does contribute to observed heterogeneity in environmental health damages, and that improving access to primary care may be a useful means of mitigating harm from a warming climate.
Inequality, Information Failures and Air Pollution
AbstractResearch spanning several disciplines has repeatedly documented disproportionate pollution exposure among the poor and communities of color. Among the various proposed causes of this pattern, those that have received the most attention are income inequality, discrimination, and firm costs (of inputs and regulatory compliance). We argue that an additional channel – information – is likely to play an important role in generating disparities in pollution exposure. We present multiple reasons for a tendency to underestimate pollution burdens, as well as empirical evidence that this underestimation can disproportionately affect low-income households. Using a model of housing choice, we then derive conditions under which “hidden” pollution leads to an inequality – even when all households face the same lack of information. This inequality arises because households sort according to known pollution and other disamenities, which we show are positively correlated with hidden pollution. To help bridge the gap between environmental justice and economics, we discuss the relationship between hidden information and three different distributional measures: exposure to pollution; exposure to hidden pollution; and welfare loss due to hidden pollution.
Does Racial Bias Distort Neighborhood Choice? Estimating the Damages from Discriminatory Constraints in the Rental Housing Market
AbstractBy constraining an individual’s choice during a search, housing discrimination distorts sorting decisions away from true preferences and results in a ceteris paribus reduction in renters’ welfare. This study combines a large-scale field experiment with a residential sorting model to derive utility-theoretic measures of renter welfare associated with the constraints imposed by discrimination in the rental housing market. In the 5 major metropolitan markets in our study, we find that lower air toxicity and key amenities such as better schools are associated with higher levels of discrimination. We estimate welfare costs to renters from constraints during a search in these 5 cities to be equivalent to 4.5% and 3.8% of the annual incomes for the average African American and Hispanic/LatinX household, respectively. These costs increase substantially at higher levels of income. African American renters face damages greater than 10% of income at income levels above $100,000 per year. Placed in the context of growing evidence on the long-run impacts of exposure to high/low amenity neighborhoods, these results illustrate a channel through which housing discrimination can create an important potential barrier to intergenerational income mobility. Strong preferences for housing in same-race neighborhoods can partially mitigate these effects at higher income levels, indicating that discriminatory constraints might induce higher income minority renters to trade off school quality or neighborhood safety for neighborhoods with other minority households. Finally, we study the effects of discrimination on revealed preferences for urban amenities. We find that discrimination drives a wedge between true preferences for pollution abatement and other key neighborhood amenities and those revealed in markets with discriminatory constraints. We find that a ignores discriminatory constraints understates African American and Hispanic amenity preferences by approximately 10%.
- Q5 - Environmental Economics