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Environmental health risks and housing values: evidence from more than 1600 toxic plant openings and closings

Environmental Health Economic Analysis Annotated Bibliography

Details

Research article Cost-benefit analysis (CBA)
Authors
Currie J, Davis L Greenstone M, and Walker R
Journal
Am Econ Rev
Summary
This cost-benefit analysis examined the external costs of industrial plants that emit toxic pollutants on housing values and birth outcomes in five US States. The authors found that: 1) toxic air pollutants affect ambient air quality within only one mile of plants; 2) plant openings lead to 11 percent declines in housing values within 0.5 miles or loss of about $4.25 million for these houses; and 3) the incidence of low birthweight increased by 3% within 1 mile of operating industrial plants. Reliable measures of these different costs and benefits can help policymakers efficiently make siting decisions.
Population
Not available

Health Outcomes

  • Birth outcomes (low birthweight)

Environmental Agents

List of Environmental Agents:

  • Air pollutants

Source of Environmental Agents:

  • Industrial plants

Economic Evaluation / Methods and Source

Type:

  • Cost-benefit analysis (CBA)

Cost Measured:

  • Lost housing values

Potential Cost Measures:

  • Effects of criteria pollutants (particulates, ozone) which may harm human health over a broad geographic area
  • impacts on non-residential property

Benefits Measures:

  • Local economic benefits of a plant opening (e.g., jobs, increased wages)

Potential Benefits: (Not available)

Location:

  • Texas, New Jersey, Pennsylvania, Michigan, Florida

Models Used: (Not available)

Methods Used:

  • The authors used a partial equilibrium model to compare housing values and birth outcomes in areas near a toxic plant to those in slightly further away in five U.S. states. The authors — 1) merged data on toxic emissions, housing transactions, infant health, and plant opening and closing dates; 2) used a difference-in-difference strategy to characterize the transport of toxic emissions; 3) employed an econometric regression model to examine effects of plant openings and closings on housing values, exploring effects of plant and community characteristics; and 4) examined the relationship between infant health outcomes and distance from a plant, controlling for maternal characteristics using a two-step, group-level estimator.

Sources Used:

  • Toxic Release Inventory (TRI) to identify plants emitting airborne toxic pollutants (US EPA); Longitudinal Business Database to determine plant open/close date (US Census Bureau); Standard Statistical Establishment List to obtain plant names and addresses (US Census Bureau); county registrar websites for housing transaction data; additional sources cited in publication

Economic Evaluation / Methods and Source

Citation:

  • Currie J, Davis L Greenstone M, and Walker R. 2015. Environmental health risks and housing values: evidence from more than 1600 toxic plant openings and closings. Am Econ Rev.

Pubmed:

DOI:

NIEHS Funding: (Not available)

Other Funding:

  • John D. and Catherine T. MacArthur Foundation
  • US EPA (RE: 83479301-0)