Calendrier du 25 octobre 2021
GSIELM (Graduate Students International Economics and Labor Market) Lunch Seminar
Du 25/10/2021 de 13:00 à 14:00
MSE(106, Blv de l'Hôpital) salle 116 75013 Paris
KöGEL Clara (OECD)
Air pollution and productivity: Evidence from France
There are common beliefs that agglomeration and manufacturing enhance the productivity of firms. However, these factors also increase air pollution, which can have an adverse effect on productivity. This paper investigates the effect of air pollution on labour productivity in French firms in both manufacturing and non-financial market services sectors from 2000 to 2018. I use an instrumental variable approach, based on planetary boundary layer height, to identify the causal impact of air pollution on labour productivity. I estimate that a 1 µg/m3 increase in fine particulate matter concentrations (PM 2.5) leads on average to a 4.5% decrease in labour productivity. I also find that the negative effect of pollution is less pronounced for digital intensive firms. These estimates suggest that the negative impact of air pollution is much larger than previously thought.