Ross Levine, Chen Lin, Zigan Wang, 14 June 2020

There is ample evidence of the negative effects of pollution on health, with about one in six deaths worldwide attributed to air pollution. However, the effect of one firm’s toxic emissions on neighbouring firms’ employees and profits are not known. This column examines whether opening toxic pollution-emitting plants affect the career paths of executives at S&P 1500 firms in the US. The opening of such plants triggers substantial increases in executive migration from neighbouring firms. Corporations exposed to toxic emissions from other firms lose talented individuals and suffer stock-price declines.

Adam Isen, Maya Rossin-Slater, Reed Walker, 19 February 2014

There is growing evidence that adverse infant health can have lasting effects on human capital formation and economic outcomes in adulthood. Among others, the poor environmental conditions have been linked to increased infant mortality and poor health. This column looks at the long-run effects of early-life pollution exposure. Using the Clean Air Act enacted in 1970 as a policy experiment, the study finds an association between reduced pollution and labour-market outcomes 30 years later. Reduced-pollution increases labour-force participation rate for affected individuals, which translates into a 1% increase in annual earning for an average individual in a cohort.

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