Working Paper: NBER ID: w30801
Authors: Rebecca Fraenkel; Joshua S. Graff Zivin; Sam D. Krumholz
Abstract: During the past fifteen years, more than 30% of US coal plants have had at least one coal-fired generator close. We utilize this natural experiment to estimate the effect of coal plant exposure on mortality and house values. Using a difference-in-differences design, we find that, despite the fact that most of this coal generation is replaced with natural gas generation, individuals in counties whose population centroid is within 30 miles of a plant that closes at least one coal-fired unit experience large health effects following shutdown. While these health improvements appear to capitalize into housing values, they only do so for homes within 15 miles of the plant and only when the retirement is complete rather than partial. Taken together, these results underscore the importance of subjective perceptions in shaping market-mediated price effects with far-reaching implications for the literature.
Keywords: coal plant closures; health effects; housing values; difference-in-differences
JEL Codes: I18; Q4; Q50
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Closure of coal plants (L94) | Decline in cardiovascular mortality (I12) |
| Decline in cardiovascular mortality (I12) | Increase in housing values (R31) |
| Closure of coal plants (L94) | Increase in housing values (R31) |