The Effects of Air Pollution on Health and Health Spending: Evidence from Forest Fires

Seema Jayachandran, University of California, Berkeley and University of California, Los Angeles
Sarah Reber, University of California, Los Angeles

This paper uses a natural experiment approach to estimate the causal effect of air pollution (specifically particulate matter) on mortality, morbidity and Medicare spending in the United States. In particular, we examine the effects of air pollution from large-scale forest and brush fires between 1990 and the present. Pollution from fires has a similar composition as industrial pollution but has the advantage of being concentrated in time and space. First, we examine the causal effect of particulate matter (PM) on mortality and the extent to which the effect represents “harvesting.” Second, we estimate the effect of PM on morbidities including acute myocardial infarction and respiratory problems. Third, we analyze the Medicare health care costs associated with pollution-induced health problems. We also assess whether certain populations are more susceptible to pollution (race, gender, and age).