HKUST IEMS Working Papers No. 2020-71
China’s coal-fired winter heating systems generate large amounts of hazardous emissions that significantly deteriorate air quality. Exploiting regression discontinuity designs based on the exact starting dates of winter heating across different cities, we estimate the contemporaneous impact of winter heating on air pollution and health. We find that turning on the winter heating system increased the weekly Air Quality Index by 36% and caused a 14% increase in mortality rate. This implies that a 10-point increase in the weekly Air Quality Index causes a 2.2% increase in overall mortality. People in poor and rural areas are particularly affected by the rapid deterioration in air quality; this implies that the health impact of air pollution may be mitigated by improved socio-economic conditions. Exploratory cost-benefit analysis suggests that replacing coal with natural gas for heating can improve social welfare.
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