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Title: Smoked Out: The Effect of Wildfire Smoke on Labor Market Outcomes

Citation Type: Conference Paper

Publication Year: 2017

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Abstract: This paper examines the effect of wildfire smoke on labor markets. Wildfire smoke travels hundreds and even thousands of miles from its source, generating plausibly exogenous air pollution events in distant cities. Using annual income data, we find that workers experience earnings losses of 10% of one days income per day of smoke exposure. The effects at the national level aggregate to 0.3% of annual labor income, nearly 10 times expenditures on fire prevention and suppression. We find modest non-linearities, and the largest responses in well-off areas, measured by income or unemployment rates. As well, we document extensive margin and retirement responses, a novel channel in the literature. Although they affect a small share of people, extensive margin effects appear to explain a large share of the income response to air pollution events. We examine the implications for wildfire policy.

Url: http://conference.iza.org/conference_files/environ_2016/borgschulte_m9906.pdf

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Authors: Borgschulte, Mark; Molitor, David; Zou, Eric

Conference Name: 4th IZA Conference on Labor Market Effects of Environmental Policies

Publisher Location: Bonn, Germany

Data Collections: IPUMS USA

Topics: Labor Force and Occupational Structure, Other

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