Research On The Impact Of Air Pollution On Income Gap

Over the past few decades,the overuse of non-renewable resources has supported the rapid growth of the Chinese economy,which has resulted in deteriorating air quality and ecological imbalances across the country.More specifically,air pollution has seriously threatened human production activities and life and health safety.At the same time,China is also facing severe income inequality,the income gap between different regions and different individuals is gradually widening,and China’s Gini coefficient has been set far above the international warning level of 0.4.Air pollution and its impact on health and the income gap have aroused widespread concern in China.China demands an energy conservation and emission reduction strategy to develop its economy,solve equity and efficiency problems,prevent the country from falling into the"environmental health poverty"trap,and achieve the goal of high-quality economic development by achieving high-quality economic development optimizing environmental quality.Based on this background,this paper analyzes the impact of air pollution on the income gap and the impact mechanism from multiple perspectives.It makes corresponding contributions to the academic research in environmental economics and and the realization of the goal of common prosperity.Based on the data from China Prefecture-level Municipal Level and China Health and Nutrition Survey（CHNS）,this paper examines the effect and mechanism of air pollution on the income gap from both regional and individual levels.Firstly,this paper uses the annual average concentration of PM_2.5 and the income gap between urban and rural residents in each city as explanatory variables and explanatory variables.It also incorporates some other factors that affect the income gap as control variables to study the impact of air pollution on the income gap.Moreover,this paper considers the impact of the lag of air pollution on the income gap in the current period.Due to the endogenous problem,based on the instrumental variable method,this paper adds temperature and air pollution lag of one period as tool variables and regresses the model again using the two-stage least square（2SLS）method.In addition,during the robustness test,the maximum and minimum values of PM_2.5 were used as proxy variables for the explanatory variables,the consumption ratio and income difference between urban and rural residents were used as proxy variables for the interpreted variables,and the sample size is replaced by 2002-2008 and 2009-2016.In the part of heterogeneity test,to study whether the impact of air pollution on the income gap is different in terms of the economic region,geographical region,city grade,and environmental protection policies,the samples are divided into four groups:Southern and Northern China according to geographical region,Eastern,Central,and Western China according to economic region,second-tier cities and above and other cities according to city grade,and key environmental protection cities and non-key environmental protection cities according to environmental protection policies.Different sub-samples are regressed separately.Secondly,this paper uses air pollution as the explanatory variable,residents’income level as the explained variable,residents’health status as the intermediary variable,and the corresponding data are matched.At the same time,the control variables,including education level,age,urban and rural status,medical insurance,smoking,height,weight,occupation,and work unit,were selected.Using the intermediary effect model,this paper studies the transmission mechanism of the effect of air pollution on the income gap at the individual level based on healthy human capital.Through empirical study,we find that:（1）The baseline results show that air pollution significantly widens the income gap.When the lag period of air pollution is used as the explanatory variable,the positive effect still exists,which indicates that the impact of air pollution on the income gap exists with hysteresis.（2）When temperature and air pollution lag period are added as instrumental variables,the results of 2SLS show a positive relationship between air pollution and the income gap.（3）Various robustness tests show that the conclusions of this paper are credible.（4）The effect of air pollution on the income gap is heterogeneous.Firstly,because of the threshold effect of income level,the impact of air pollution on the income gap is greater in the eastern area and developed cities.Secondly,Due to the cumulative effect of air pollution,its effect on the widening income gap is greater in northern regions with more severe air pollution.（5）Further mechanism test shows that healthy human capital is an important mechanism of this effect.Through empirical research from three perspectives,we can find that the effect of air pollution on the health human capital loss of high-income,urban,and highly educated people is lower than that of low-income and rural populations and those with low education.The above results suggest that air pollution will further affect the income gap through the impact of human health capital.To reduce the income gap,we should strengthen the control of air pollution and take control of air pollution and the promotion of human health capital as important measures to promote economic development and reduce income disparity.