PM2.5 Pollution: Health and Economic Effect Assessment Based on a Recursive Dynamic Computable General Equilibrium Model

Abstract

At present particulate matter (PM 2.5 ) pollution represents a serious threat to the public health and the national economic system in China. This paper optimizes the whitening coefficient in a grey Markov model by a genetic algorithm, predicts the concentration of fine particulate matter (PM 2.5 ), and then quantifies the health effects of PM 2.5 pollution by utilizing the predicted concentration, computable general equilibrium (CGE), and a carefully designed exposure-response model. Further, the authors establish a social accounting matrix (SAM), calibrate the parameter values in the CGE model, and construct a recursive dynamic CGE model under closed economy conditions to assess the long-term economic losses incurred by PM 2.5 pollution. Subsequently, an empirical analysis was conducted for the Beijing area: Despite the reduced concentration trend, PM 2.5 pollution continued to cause serious damage to human health and the economic system from 2013 to 2020, as illustrated by various facts, including: (1) the estimated premature deaths and individuals suffering haze pollution-related diseases are 156,588 (95% confidence intervals (CI): 43,335-248,914)) and six million, respectively; and (2) the accumulated labor loss and the medical expenditure negatively impact the regional gross domestic product, with an estimated loss of 3062.63 (95% CI: 1,168.77-4671.13) million RMB. These findings can provide useful information for governmental agencies to formulate relevant environmental policies and for communities to promote prevention and rescue strategies.

A Multivariate Mediation Analysis of PM2.5 Pollution and Stock Market Returns

“…In China, there are 156,588 premature deaths and more than 6 million individuals suffer from air pollution-related diseases annually. This has caused a loss of 3,026.62 million Chinese yuan in labor losses and medical expenditure (Chen et al, 2019). For the United States, Deryugina et al (2019) reported that an increase in PM2.5 of 1 microgram per cubic foot led to a loss of 2.99 life years per 1 million beneficiaries over three days, amounting to a loss of 299,000 dollars.…”