The Annals of Regional Science

, Volume 63, Issue 2, pp 269–293 | Cite as

Health effects of ozone and particulate matter pollution in China: a province-level CGE analysis

  • Kyung-Min NamEmail author
  • Xu Zhang
  • Min Zhong
  • Eri Saikawa
  • Xiliang ZhangEmail author
Special Issue Paper


In this study, we estimate the cost of PM2.5 and O3 pollution in China and explore how it differs by province. For the analysis, we extend the China Regional Energy Model—a computable general equilibrium model of the Chinese economy—to explicitly represent the pollution-health linkage within a larger economic system. Our results show that health damage from air pollution in China is substantially large. For each year between 2010 and 2030, China’s welfare loss from excess pollution is estimated to be 3.2–5.1% of the baseline level when welfare is measured as the sum of consumption and leisure. The PM2.5 share of the costs was > 13 times as large as the O3 share, and premature deaths from chronic exposure to PM2.5 were the single most important health endpoint, accounting for ≤ 56% of the total costs. Cross-regional heterogeneity is substantial, and populous and wealthy Eastern China is subject to particularly large health damage. When the size of provincial economies is controlled for, however, the dominance of the eastern region is less obvious and several inland provinces (e.g., Henan, Shanxi, and Chongqing) also suffer high pollution-health costs, due to low air quality and fast productivity growth. Finally, broader economic loss from inefficient resource allocation and its cumulative effects, which is often neglected in static analysis, accounts for > 29% of the total costs. Overlooking this cost component will, in particular, lead to substantial underestimation for China’s central and western regions, whose economies are growing fast.

JEL Classification

C68 D58 I18 Q51 Q52 Q53 



We acknowledge the financial support of the Hong Kong Research Grant Council (ECS Award No.: 27200915) and the National Natural Science Foundation of China (Project No.: 71690244). The authors would like to express our special thanks to Da Zhang and Xiaohan Zhang for their helpful comments and input.


  1. Aunan K, Fang J, Vennemo H, Oye K, Seip HM (2004) Co-benefits of climate policy—lessons learned from a study in Shanxi, China. Energy Policy 32:567–581Google Scholar
  2. Babiker MH, Metcalf GE, Reilly JM (2003) Tax distortions and global climate policy. J Environ Econ Manag 46:269–287Google Scholar
  3. Ban J, Li T-t (2016) Short-term effects of different ozone metrics on daily mortality in Beijing. J Environ Health 33:287–291Google Scholar
  4. Bickel P, Friedrich R (eds) (2005) ExternE—externalities of energy: methodology 2005 update. European Commission, LuxembourgGoogle Scholar
  5. Burnett RT et al (2014) An integrated risk function for estimating the global burden of disease attributable to ambient fine particulate matter exposure. Environ Health Perspect 122:397–403Google Scholar
  6. Cao J, Yang C, Li J, Chen R, Chen B, Gu D, Kan H (2011) Association between long-term exposure to outdoor air pollution and mortality in China: a cohort study. J Hazard Mater 186(2–3):1594–1600Google Scholar
  7. Chen R et al (2011) Coarse particles and mortality in three Chinese cities: the China air pollution and health effects study (CAPES). Sci Total Environ 409:4934–4938Google Scholar
  8. Chen H et al (2017) The MIT economic projection and policy analysis (EPPA) model: version 5. Technical note 16. MIT Joint Program on the Science and Policy of Global Change, Cambridge, MAGoogle Scholar
  9. Chen K, Yang HB, Ma ZW, Bi J, Huang L (2013) Influence of temperature to the short-term effects of various ozone metrics on daily mortality in Suzhou, China. Atmos Environ 79:119–128Google Scholar
  10. Chen Q, Sun H, Chen X-d, Ding Z (2017) Acute health impacts of ozone exposure on daily mortality in Nanjing. Jiangsu J Prev Med 28:366–386Google Scholar
  11. Clean Air Alliance of China (CAAC) (2013) Twelfth five-year plan on air pollution prevention and control in key regions: english translation. Clean Air Alliance of China, BeijingGoogle Scholar
  12. Cohen AJ et al (2017) Estimates and 25-year trends of the global burden of disease attributable to ambient air pollution: an analysis of data from the global burden of diseases study 2015. Lancet 389:1907–1918Google Scholar
  13. Dai H, Song W, Gao X, Chen L, Hu M (2004) Study on relationship between ambient PM10, PM2.5 pollution and daily mortality in a district in Shanghai. J Hyg Res 33:293–297Google Scholar
  14. Environmental Protection Agency (EPA) United States of America (1999) The benefits and costs of the clean air act 1990 to 2010. National Technical Information Service, Springfield, VAGoogle Scholar
  15. GBD 2013 Risk Factors Collaborators (2015) Global, regional, and national comparative risk assessment of 79 behavioural, environmental and occupational, and metabolic risks or clusters of risks in 188 countries, 1990–2013: a systematic analysis for the global burden of disease study 2013. Lancet 386:2287–2323Google Scholar
  16. Guo Y, Jia Y, Pan X, Liu L, Wichmann H-E (2009) The association between fine particulate air pollution and hospital emergency room visits for cardiovascular diseases in Beijing, China. Sci Total Environ 407:4826–4830Google Scholar
  17. Guo Y, Tong S, Zhang Y, Barnett AG, Jia Y, Pan X (2010) The relationship between particulate air pollution and emergency hospital visits for hypertension in Beijing, China. Sci Total Environ 408:4446–4450Google Scholar
  18. Guo H, Huang S, Chen M (2018a) Air pollutants and asthma patient visits: indication of source influence. Sci Total Environ 625:355–362Google Scholar
  19. Guo P et al (2018b) Short-term associations of ambient air pollution and cause-specific emergency department visits in Guangzhou, China. Sci Total Environ 613–614:306–313Google Scholar
  20. Hirschberg S et al (2003) Environmental impact and external cost assessment. In: Eliasson B, Lee YY (eds) Integrated assessment of sustainable energy systems in China. Kluwer, DordrechtGoogle Scholar
  21. Hoffmann S, Krupnick A, Qin P (2017) Building a set of internationally comparable value of statistical life studies: estimates of Chinese willingness to pay to reduce mortality risk. J Benefit Cost Anal 8:251–289Google Scholar
  22. Holland M, Berry J, Forster D (eds) (1999) ExternE: externalities of energy vol 7: methodology 1998 update. European Commission, LuxembourgGoogle Scholar
  23. Holland M, Watkiss P, Pye S, Oliveira Ad, Regemorter DV (2005) Cost-benefit analysis of policy option scenarios for the clean air for Europe programmeGoogle Scholar
  24. Huang W et al (2009) Visibility, air quality and daily mortality in Shanghai, China. Sci Total Environ 407:3295–3300Google Scholar
  25. Huang W et al (2012) Seasonal variation of chemical species associated with short-term mortality effects of PM2.5 in Xi’an, a Central City in China. Am J Epidemiol 175:556–566Google Scholar
  26. International Institute for Applied Systems Analysis (IIASA) (2018) Greenhouse gas and air pollution interactions and synergies (GAINS) for East Asia. Accessed 1 Dec 2018
  27. Kan H et al (2007) Differentiating the effects of fine and coarse particles on daily mortality in Shanghai, China. Environ Int 33:376–384Google Scholar
  28. Kan H et al (2008) Season, sex, age, and education as modifiers of the effects of outdoor air pollution on daily mortality in Shanghai, China: the public health and air pollution in Asia (PAPA) study. Environ Health Perspect 116:1183–1188Google Scholar
  29. Ko FWS, Tam W, Wong TW, Chan DPS, Tung AH, Lai CKW, Hui DSC (2007a) Temporal relationship between air pollutants and hospital admissions for chronic obstructive pulmonary disease in Hong Kong. Thorax 62:780–785Google Scholar
  30. Ko FWS et al (2007b) Effects of air pollution on asthma hospitalization rates in different age groups in Hong Kong. Clin Exp Allergy 37:1312–1319Google Scholar
  31. Lei Y, Ho MS (2013) The valuation of health damages. In: Nielsen CP, Ho MS (eds) Clearing skies over China: reconciling air quality, climate, and economic goals. MIT Press, CambridgeGoogle Scholar
  32. Li X, Nam K-M (2017) One country two “Urban” systems: focusing on bimodality in China’s city-size distribution. Ann Reg Sci 59:427–452Google Scholar
  33. Li P et al (2013) The acute effects of fine particles on respiratory mortality and morbidity in Beijing, 2004–2009. Environ Sci Pollut Res 20:6433–6444Google Scholar
  34. Lin Y-K, Chang S-C, Lin C, Chen Y-C, Wang Y-C (2013) Comparing ozone metrics on associations with outpatient visits for respiratory diseases in Taipei metropolitan area. Environ Pollut 177:177–184Google Scholar
  35. Liu W (2016) Effects of air pollution on hospital emergency room visits for respiratory diseases and assessment of residents’ willingness-to-pay for good air quality. Unpublished Master’s Thesis, Shandong University, QingdaoGoogle Scholar
  36. Liu T et al (2013) The short-term effect of ambient ozone on mortality is modified by temperature in Guangzhou, China. Atmos Environ 76:59–67Google Scholar
  37. Liu T et al (2016) Temporal–spatial distribution of mortality risk caused by ambient ozone and its modification factors in the Pearl River Delta region. South China J Prev Med 42:201–207Google Scholar
  38. Matus K (2005) Health impacts from urban air pollution in China: the burden to the economy and the benefits of policy. Unpublished Master's Thesis, Massachusetts Institute of TechnologyGoogle Scholar
  39. Matus K, Yang T, Paltsev S, Reilly JM, Nam K-M (2008) Toward integrated assessment of environmental change: air pollution health effects in the USA. Clim Change 88:59–92Google Scholar
  40. Matus K, Nam K-M, Selin NE, Lamsal LN, Reilly JM, Paltsev S (2012) Health damages from air pollution in China. Glob Environ Change 22:55–66Google Scholar
  41. Morita H, Yang S, Unger N, Kinney PL (2014) Global health impacts of future aviation emissions under alternative control scenarios. Environ Sci Technol 48:14659–14667Google Scholar
  42. Nam K-M (2017) Is the spatial distribution of China’s population excessively unequal? A cross-country comparison. Ann Reg Sci 59:453–474Google Scholar
  43. Nam K-M (2019) Environmental challenges in Chinese mega-city regions: focusing on air quality management. In: Yeh AGO, Lin GCS, Yang FF (eds) Mega-city region development in China. Routledge, AbingdonGoogle Scholar
  44. Nam K-M, Reilly JM (2013) City size distribution as a function of socioeconomic conditions: an eclectic approach to downscaling global population. Urban Stud 50:208–225Google Scholar
  45. Nam K-M, Selin NE, Reilly JM, Paltsev S (2010) Measuring welfare loss caused by air pollution in Europe: a CGE analysis. Energy Policy 38:5059–5071Google Scholar
  46. Nam K-M, Li M, Wang Y, Wong KKH (2018) Spatio-temporal boundary effects on pollution-health costs estimation: the case of PM2.5 pollution in Hong Kong. Int J Urban Sci. CrossRefGoogle Scholar
  47. National Bureau of Statistics of China (2016) China statistical yearbook. China Statistics Press, BeijingGoogle Scholar
  48. Nielsen CP, Ho MS (2013) Atmospheric environment in China: introduction and research review. In: Nielsen CP, Ho MS (eds) Clearing skies over China: reconciling air quality, climate, and economic goals. MIT Press, CambridgeGoogle Scholar
  49. O’Connor D, Zhai F, Aunan K, Berntsen T, Vennemo H (2003) Agricultural and human health impacts of climate policy in China: a general equilibrium analysis with special reference to Guangdong. Technical paper series no. 206. OECD Development Centre, ParisGoogle Scholar
  50. Organisation for Economic and Co-operative Development (OECD) (2016) The economic consequences of outdoor air pollution: policy highlights. OECD, ParisGoogle Scholar
  51. Ostro BD, Chestnut L (1998) Assessing the health benefits of reducing particulate matter air pollution in the United States. Environ Res 76:94–106Google Scholar
  52. Paltsev S et al (2005) The MIT emissions prediction and policy analysis (EPPA) model: version 4. Report 125. MIT Joint Program on the Science and Policy of Global Change, Cambridge, MAGoogle Scholar
  53. Pope CAI, Thun MJ, Namboodiri MM, Dockery DW, Evans JS, Speizer FE Jr, CWH (1995) Particulate air pollution as a predictor of mortality in a prospective study of US adults. Am J Respir Crit Care Med 151:669–674Google Scholar
  54. Pope CAI, Burnett RT, Thun MJ, Calle EE, Krewski D, Ito K, Thurston GD (2002) Lung cancer, cardiopulmonary mortality, and long-term exposure to fine particulate air pollution. J Am Med Assoc 287:1132–1141Google Scholar
  55. Qian Z et al (2007) Short-term effects of gaseous pollutants on cause-specific mortality in Wuhan, China. J Air Waste Manag Assoc 57:785–793Google Scholar
  56. Qiao L et al (2014) PM2.5 constituents and hospital emergency-room visits in Shanghai, China. Environ Sci Technol 48:10406–10414Google Scholar
  57. Qiu H, Yu IT, Wang X, Tian L, Tse LA, Wong TW (2013) Differential effects of fine and coarse particles on daily emergency cardiovascular hospitalizations in Hong Kong. Atmos Environ 64:296–302Google Scholar
  58. Reilly JM et al (2013) Valuing climate impacts in integrated assessment models: the MIT IGSM. Clim Change 117:561–573Google Scholar
  59. Saikawa E, Naik V, Horowitz LW, Liu J, Mauzerall DL (2009) Present and potential future contributions of sulfate, black and organic carbon aerosols from China to global air quality, premature mortality and radiative forcing. Atmos Environ 43:2814–2822Google Scholar
  60. Selin NE, Wu S, Nam KM, Reilly JM, Paltsev S, Prinn RG, Webster MD (2009) Global health and economic impacts of future ozone pollution. Environ Res Lett 4(4):044014Google Scholar
  61. Shang Y et al (2013) Systematic review of Chinese studies of short-term exposure to air pollution and daily mortality. Environ Int 54:100–111Google Scholar
  62. Su C, Breitner S, Schneider A, Liu L, Franck U, Peters A, Pan X (2016) Short-term effects of fine particulate air pollution on cardiovascular hospital emergency room visits: a time-series study in Beijing, China. Int Arch Occup Environ Health 89:641–657Google Scholar
  63. Tao Y et al (2012) Estimated acute effects of ambient ozone and nitrogen dioxide on mortality in the Pearl River Delta of Southern China. Environ Health Perspect 120:393–398Google Scholar
  64. Tao Y, Liu Y, Mi S, Guo Y (2014) Atmospheric pollution characteristics of fine particles and their effects on human health. Acta Sci Circum 34:592–597Google Scholar
  65. Thompson TM, Saari RK, Selin NE (2014) Air quality resolution for health impact assessment: influence of regional characteristics. Atmos Chem Phys 14:969–978Google Scholar
  66. Tian L et al (2014) Ambient carbon monoxide and the risk of hospitalization due to chronic obstructive pulmonary disease. Am J Epidemiol 180:1159–1167Google Scholar
  67. Vennemo H, Aunan K, Jinghua F, Holtedahl P, Tao H, Seip HM (2006) Domestic environmental benefits of China’s energy-related CDM potential. Clim Change 75:215–239Google Scholar
  68. Viscusi WK, Harrington JE Jr, Vernon JM (2005) Economics of regulation and antitrust, 4th edn. MIT Press, CambridgeGoogle Scholar
  69. Wang X et al (2016) Study of relationship between atmospheric fine particulate matter concentration and one grade a tertiary hospital emergency room visits during 2012 and 2013 in Beijing. Chin J Prev Med 50:73–78Google Scholar
  70. West JJ, Fiore AM, Horowitz LW, Mauzerall DL (2006) Global health benefits of mitigating ozone pollution with methane emission controls. Proc Natl Acad Sci USA 103:3988–3993Google Scholar
  71. Wong TW, Lau TS, Yu TS, Neller A, Wong SL, Tam W, Pang SW (1999) Air pollution and hospital admissions for respiratory and cardiovascular diseases in Hong Kong. Occup Environ Med 56:679–683Google Scholar
  72. Wong C-M, Ma S, Hedley AJ, Lam T-H (2001) Effect of air pollution on daily mortality in Hong Kong. Environ Health Perspect 109:335–340Google Scholar
  73. Wong C-M, Atkinson RW, Anderson HR, Hedley AJ, Ma S, Chau PY-K, Lam T-H (2002) A tale of two cities: effects of air pollution on hospital admissions in Hong Kong and London compared. Environ Health Perspect 110:67–77Google Scholar
  74. Wong C-M, Vichit-Vadakan N, Kan H, Qian Z, PAPA Project Teams (2008) Public health and air pollution in Asia (PAPA): a multicity study of short-term effects of air pollution on mortality. Environ Health Perspect 116:1195–1202Google Scholar
  75. Wong C-M et al (2010) Public health and air pollution in Asia (PAPA): coordinated studies of short-term exposure to air pollution and daily mortality in four cities, vol 154. Health Effects Institute, Boston, MAGoogle Scholar
  76. World Bank (1997) Clear water, blue skies: China’s environment in the new century. China 2020. World Bank, Washington, D.C.Google Scholar
  77. World Bank, Institute for Health Metrics and Evaluation (IHME) (2016) The cost of air pollution: strengthening the economic case for action. World Bank, Washington, DCGoogle Scholar
  78. World Bank, State Environmental Protection Administration (SEPA) PRC (2007) Cost of pollution in China: economic estimates of physical damages. World Bank, Washington, DCGoogle Scholar
  79. World Health Organization (WHO) (2016) Ambient air pollution: a global assessment of exposure and burden of disease. WHO, GenevaGoogle Scholar
  80. Xie P, Liu X, Liu Z, Li T, Zhong L, Xiang Y (2011) Human health impact of exposure to airborne particulate matter in Pearl River Delta, China. Water Air Soil Pollut 215:349–363Google Scholar
  81. Xie W et al (2015) Relationship between fine particulate air pollution and ischaemic heart disease morbidity and mortality. Heart 101:257–263Google Scholar
  82. Xie Y, Dai H, Dong H, Hanaoka T, Masui T (2016) Economic impacts from PM2.5 pollution-related health effects in China: a provincial-level analysis. Environ Sci Technol 50:4836–4843Google Scholar
  83. Xu M, Stanway D (2017) China aims to meet air quality standards by 2035: Minister. Reuters. October 23Google Scholar
  84. Xu X, Li B, Huang H (1995) Air pollution and unscheduled hospital outpatient and emergency room visits. Environ Health Perspect 103(3):286–289Google Scholar
  85. Yang T (2004) Economic and policy implications of urban air pollution in the United States: 1970 to 2000. Unpublished Master’s Thesis, Massachusetts Institute of Technology, Cambridge, MAGoogle Scholar
  86. Yang C, Peng X, Huang W, Chen R, Xu Z, Chen B, Kan H (2012a) A time-stratified case-crossover study of fine particulate matter air pollution and mortality in Guangzhou, China. Int Arch Occup Environ Health 85:579–585Google Scholar
  87. Yang C, Yang H, Guo S, Wang Z, Xu X, Duan X, Kan H (2012b) Alternative ozone metrics and daily mortality in Suzhou: the China air pollution and health effects study (CAPES). Sci Total Environ 426:83–89Google Scholar
  88. Zhang Y et al (2006) Ozone and daily mortality in Shanghai, China. Environ Health Perspect 114:1227–1232Google Scholar
  89. Zhang D, Rausch S, Karplus VJ, Zhang X (2013) Quantifying regional economic impacts of CO2 intensity targets in China. Energy Econ 40:687–701Google Scholar
  90. Zhang X, Ou X, Yang X, Qi T, Nam K-M, Zhang D, Zhang X (2017) Socioeconomic burden of air pollution in China: province-level analysis based on energy economic model. Energy Econ 68:478–489Google Scholar
  91. Zhou Y, Hammitt JK (2007) The economic value of air-pollution-related health risks in China: a contingent valuation study. In: Ho MS, Nielsen CP (eds) Clearing the air: the health and economic damages of air pollution in China. MIT Press, CambridgeGoogle Scholar

Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2019

Authors and Affiliations

  1. 1.Department of Urban Planning and DesignThe University of Hong KongPokfulamChina
  2. 2.Institute of Energy, Environment and EconomyTsinghua UniversityBeijingChina
  3. 3.Environmental Analysis and Outcomes DivisionMinnesota Pollution Control AgencySt PaulUSA
  4. 4.Department of Environmental SciencesEmory UniversityAtlantaUSA

Personalised recommendations