Air Pollution and Road Safety
Tesis, Magíster en Economía, IE-PUC, 2017
Abstract: I link 6-hour air pollution exposure to the total number of car accidents in the city of Santiago by exploiting time series variation from 2013 to 2016. In order to identify the causal effect of CO exposure, I use plausible exogenous variation in atmospheric stability to instrument CO exposure. I found a nonlinear relationship between CO exposure and the total number of car accidents. This result is driven by nonfatal accidents. Indeed, I do not find any impact on fatal accidents. In addition, the results hold under a battery of robustness checks. Although Santiago’s CO level is far below the international criteria of a hazardous level, I argue that reducing the average level of pollution leads to a sizable increase in social welfare due to a reduction in the number of car accidents.
Key words: Air pollution, Car accidents, Instrumental variables.
JEL Codes: Q53, R41.