Abstract

LTHOUGH substantial policy initiatives are aimed at reducing air pollution, uncertainty remains about the nature and extent of benefits from these actions. Existing epidemiological studies point to a variety of health impacts, but it remains difficult to assess the economic or social values of these impacts. It is also difficult to be confident that existing studies separate the causal impacts of pollution from correlated effects of neighborhoods, poverty, and a variety of household choices. We focus on how pollution affects school absences. By matching detailed schooling records with variations in the level of specific pollutants, we are able to establish a strong link to school absences. A large literature links child health and human capital attainment. Grossman and Kaestner (1997) summarize this literature and point to school absences as a major causal link in this relationship: children who miss a lot of school achieve poorer grades, are less engaged with school, and are more likely to drop out. Absences are also of concern to parents, who have to miss work, and to school districts, because state funding frequently depends on attendance. In states where funding depends on student attendance, schools can lose as much as $50 per day per unexcused absence. Nonetheless, policy interventions that might reduce absences are less clear. Air pollution is a possible cause of school absence for some children. Children with respiratory problems such as

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