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In this paper, we analyze how a change in the guidelines for describing exposure to air pollution affects the consumption of respiratory medicine. In 2018, the government of the Republic of Korea (South Korea) changed air pollution warning standards to a level that was more severe than that the government had previously used, thus causing people to perceive a greater danger from air pollution. Exploiting exogenous policy change and district-level spatial variation, we find that one additional day labeled "bad" under the new guidelines was associated with an increase in the consumption of medicine related to the respiratory system by 0.9% per person. A heterogeneous analysis reveals that 1) the impact is smaller in one day among consecutive days of bad air pollution than a single, isolated day of bad air pollution, 2) residents are slightly more likely to go to a pharmacy than hospitals to obtain such medicine, and 3) the impact varies by type of medicine. The results suggest that environmental policy that affects individuals' perceptions has an impact on their health-related behaviors, even though actual pollutant levels have not changed. The results are robust to alternative specifications and consistent with several placebo tests.
Presenter(s)
Nobuhiko Nakazawa, Hitotsubashi University
Non-Presenting Authors
Youngju Lee, Charles River Associates
Does How Air Pollution Levels are Labeled Matter? Evidence from Consumption of Respiratory Medicine in South Korea
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Session: [052] SOCIAL PREFERENCES AND PUBLIC POLICY Date: 7/2/2023 Time: 4:30 PM to 6:15 PM