Environmental regulations have contributed to environmental quality improvements over the past century in the U.S. Potential consequences of environmental regulations for economic growth and productivity have been widely examined in the economics literature. However, there’s limited research on how such policies affect human health, fetuses and infants especially. In this dissertation, I explore the health impact of two urban environment improvement policies: traffic reduction policy (i.e. gasoline taxes) and urban greenspace conservation (i.e. park expansion).
I develop an integrated approach for examining the effects of environmental policies on infant birth weight when residents are permitted to sort themselves across a city in response to a policy. The model explicitly accounts for the household self-selection process, one of the most important systematic ways in which a family can affect its exposure to urban (dis)amenities such as air pollution or greenspace.
I first use data on over 250,000 births to estimate an econometric model of health outcomes to measure the short-term effects of urban (dis)amenities on birth weight. In particular, I have combined propensity score matching with post-matching panel regression techniques (neighborhood fixed effects) to control for the unobservable neighborhood attributes that simultaneously affect sorting and birth outcomes. A novel feature of the health model is that the property value of each mother’s residence is used as a fine-scale proxy for family income, which is new in the literature. Next, I use approximately 500,000 housing transactions in the Portland Metropolitan area of Oregon to estimate a random-utility-based sorting model for the same period. Key variables driving the sorting process include resident demographics, housing attributes, neighborhood built environment characteristics, and social characteristics. I then introduce policy shocks and house-price distributions it induces, which allows me to simulate birth weights in the neighborhoods contingent on residential sorting in response to the policy. Since housing prices proxying for income in the health model are endogenous in my integrated framework, my approach disentangles both the short-run direct and sorting-induced long-run indirect health effects of environmental regulations.
Findings of the health model show that neighborhood (dis)amenities have significant impacts on infant birth weight. More importantly, the health effects differ greatly across high- and low-income groups, validating the interaction between socioeconomic disparities and fetus health. These findings also signal the importance of addressing potential endogeneity embedded in family income. The sorting model results demonstrate that household demand for neighborhood amenity improvements is strongly heterogeneous, suggesting that new policies to improve neighborhood health environments, such as a traffic volume reduction and greenspace conservation, induce re-sorting. Because incomes in the re-sorted landscape differ substantially from those in the pre-sorted landscape, health effects of environmental regulations differ substantially between the two also.