This article uses linked worker-firm data in the United States to estimate the transitional costs associated with reallocating workers from newly regulated industries to other sectors of the economy in the context of new environmental regulations. The focus on workers rather than industries as the unit of analysis allows me to examine previously unobserved economic outcomes such as nonemployment and long-run earnings losses from job transitions, both of which are critical to understanding the reallocative costs associated with these policies. Using plant-level panel variation induced by the 1990 Clean Air Act Amendments (CAAA), I find that the reallocative costs of environmental policy are significant. Workers in newly regulated plants experienced, in aggregate, more than $5.4 billion in forgone earnings for the years after the change in policy. Most of these costs are driven by nonemployment and lower earnings in future employment, highlighting the importance of longitudinal data for characterizing the costs and consequences of labor market adjustment. Relative to the estimated benefits of the 1990 CAAA, these one-time transitional costs are small.

This paper uses newly available data on plant level regulatory status linked to the Census Longitudinal Business Database to measure the impact of changes in county level environmental regulations on plant and sector employment levels. Estimates from a variety of specifications suggest a strong connection between changes in environmental regulatory stringency and both employment growth and levels in the affected sectors. The preferred estimates suggest that changes in county level regulatory status due to the 1990 Clean Air Act Amendments reduced the size of the regulated sector by as much as 15 percent in the 10 years following the changes.

We link daily air pollution exposure to measures of contemporaneous health for communities surrounding the twelve largest airports in California. These airports are some of the largest sources of air pollution in the US, and they experience large changes in daily air pollution emissions depending on the amount of time planes spend idling on the tarmac. Excess airplane idling, measured as residual daily taxi time, is due to network delays originating in the Eastern US. This idiosyncratic variation in daily airplane taxi time significantly impacts the health of local residents, largely driven by increased levels of carbon monoxide (CO) exposure. We use this variation in daily airport congestion to estimate the population dose-response of health outcomes to daily CO exposure, examining hospitalization rates for asthma, respiratory, and heart-related emergency room admissions. A one standard deviation increase in daily pollution levels leads to an additional $540 thousand in hospitalization costs for respiratory and heart-related admissions for the 6 million individuals living within 10 km (6.2 miles) of the airports in California. These health effects occur at levels of CO exposure far below existing Environmental Protection Agency mandates, and our results suggest there may be sizable morbidity benefits from lowering the existing CO standard.

This paper examines the long-term impacts of in-utero and early childhood exposure to ambient air pollution on adult labor market outcomes. We take advantage of a new administrative data set that is uniquely suited for addressing this question because it combines information on individuals ’ quarterly earnings together with their counties and dates of birth. We use the sharp changes in ambient air pollution concentrations driven by the implementation of the 1970 Clean Air Act Amendments as a source of identifying variation, and we compare cohorts born in counties that experienced large changes in total suspended particulate (TSP) exposure to cohorts born in counties that had minimal or no changes. We find a significant relationship between TSP exposure in the year of birth and adult labor market outcomes. A 10 unit decrease in TSP in the year of birth is associated with a 1 percent increase in annual earnings for workers aged 29-31. Most, but not all, of this effect is driven by an increase in labor force participation. In present value, the gains from being born into a county affected by the 1970 Clean Air Act amount to about $4,300 in lifetime income for the 1.5 million individuals born into