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Session Chair: Philipp Bothe, Paris School of Economics
Location:Auditorium B: Frøystein Gjesdal
Presentations
Does Working from Home Pollute? The Environmental Effects of WFH
Simon Briole1, Emmanuelle LAVAINE2
1CEE-M, Univ de Montpellier, CNRS, INRAE, Institut Agro Montpellier; 2CEE-M, Univ de Montpellier, CNRS, INRAE, Institut Agro Montpellier
Discussant: Robert Elliott (University of Birmingham)
Work-from-home (WFH) arrangements experienced an unprecedented boom since the
Covid-19 crisis, raising questions about their environmental impact. This study investigates the causal effect of WFH on PM2.5 concentrations, the most harmful air pollutant globally, using high-resolution pollution data and employment records from France. We find that WFH contributes to higher PM2.5 levels, particularly in areas with a high prevalence of home-based workers. Our analysis reveals that residential emissions outweigh the reduction in transport-related pollution, leading to a net increase in air pollution. These findings highlight the need for policymakers to address the environmental challenges associated with the growing prevalence of WFH, particularly through energy efficiency improvements and cleaner residential heating technologies.
Public Environmental Complaints and Regulatory Intensity
Jiaqi Zhang1, Robert Elliott2, Mengdi Liu3, Bing Zhang4
1Nanjing University, China; 2University of Birmingham, United Kingdom; 3University of International Business and Economics, China; 4Nanjing University of Finance and Economics, China
Discussant: Roman Eric Sieler (University of Basel)
Encouraging the public to report possible environmental violations can be a way
to identify illegal polluting activity and subsequently improve the environment. However, responding to complaints is not costless and may divert limited resources away
from other enforcement activities. This paper investigates the impact of China’s environmental complaints on the allocation and intensity of on-site inspections in Jiangsu
Province. Estimating a Local Projection model, our results show that complaints trigger an immediate and sustained response from the regulator, increasing the probability
that a firm is inspected by around 12.6 percentage points in the month the complaint is
made and continuing to increase over the following two months. We find complaints do
not significantly reduce the number of other types of inspections and may even increase
the number of unplanned inspections, thereby increasing overall regulatory intensity.
Bad for business? The impact of air quality on firm outcomes in Germany
Roman Eric Sieler1, Beat Hintermann1, Corrado Di Maria2
1University of Basel, Switzerland; 2University of East Anglia, UK
Discussant: Philipp Bothe (Paris School of Economics)
Whereas traditionally, economic output and environmental quality were usually
understood as substitutes, recent scientific evidence increasingly points towards a complementary
relationship, especially in the context of high pollution contexts. This
paper focuses on a developed economy, Germany, and analyzes the impacts of comparatively
modest changes of air pollution on plant and firm-level outcomes in the
manufacturing sector. Using administrative data from Germany, we analyze the the
causal effect of air pollution on a range of plant- and firm-level outcomes, namely
production value, revenue, hours worked and salaries paid, allowing us to disentangle
productivity and absenteeism effects. Our results imply that air pollution negatively
impacts production and revenue in the German manufacturing sector. While findings
on hours worked are mixed, our results show that air pollution increases labor costs,
particularly for smaller firms, likely due to the need to compensate absences through
overtime. Larger firms are likely better able to absorb absences, which is why we
observe reduced hours worked for such firms. We can also show that effects of air
pollution materialize in the relatively short time frame of individual days.
Lost in Aggregation: The Local Environmental and Welfare Effects of Large Industrial Shutdowns
Philipp Bothe1,2
1Paris School of Economics, France; 2World Inequality Lab
Discussant: Emmanuelle LAVAINE (University of Montpellier)
The clean energy transition and large-scale deindustrialization have caused major changes
in the industrial landscape of many high-income economies. This paper investigates
how closures of large industrial facilities in Germany affect surrounding communities.
By exploiting quasi-random variation in the timing of facility shutdowns, I analyze the
neighborhood-level effects of these closures using data at the 1km x 1km grid cell level.
I find that shutdowns of industrial sites lead to significant improvements in environmental
amenities as represented by air quality. These environmental benefits, however, do
not capitalize into increasing housing prices. Instead, housing values fall by up to 5%
following facility shutdowns – a result that contrasts with existing evidence for the US
context. Neighborhoods affected by industrial closures also experience substantial local
downturns with average household income dropping by 4% in the most affected neighborhoods.
The resulting total annual income loss attributable to facility shutdowns amounts
to e0.7 - e1.9 billion. Using a simplified model of neighborhood choice, I further show
that neighborhoods surrounding a closed industrial site become less amenable over time.
These findings have important implications for place-based policies in the context of significant
structural change. Additionally, using the newly assembled granular data, I show
that there exists significant inequality in the exposure to fine particulate matter across the