Automating air pollution monitoring
Highly polluted air sweeps through downtown Shanghai at dawn.
Source: Breev Sergey
China’s unprecedented economic growth over the last four decades has been accompanied by a significant amount of air pollution. By 2010, China had become the world’s largest emitter of CO₂ and SO₂.
But the introduction of an automatic monitoring program in 2014 revealed just how much city officials were underreporting air pollution, according to a paper in the American Economic Review: Insights.
Authors Michael Greenstone, Guojun He, Ruixue Jia, and Tong Liu state that China’s “war on pollution” shows how technology can help central governments monitor lower-level administrators when they have to delegate reporting responsibilities.
The researchers collected news reports to determine the exact dates that China’s automatic monitoring program was implemented in 123 cities, which included a total of 654 monitoring stations. Using a regression discontinuity design, they compared the reported levels of particulate matter (PM) in the air before and after the reforms.
Figure 2 from the authors’ paper shows the estimates of how much the pollution data was manipulated across several Chinese cities.
Figure 2 from Greenstone et al. (2022)
The y-axis indicates the average increase in reported PM₁₀, and the vertical bars show 95 percent confidence intervals. The estimates are positive for more than 70 percent of the cities. And among them, 33 estimates are positive and statistically significant (red squares).
The results suggest manipulation was widespread, rather than being concentrated in a few cities. Overall, pollution reporting increased by 28.2 μg/m3 (dashed red line), or roughly 30 percent relative to the post-automation mean.
The researchers also found that more accurate information resulting from improved reporting measures led to increased online searches for face masks and air filters, strong predictors of purchases, which likely resulted in welfare gains.
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“Can Technology Solve the Principal-Agent Problem? Evidence from China's War on Air Pollution” appears in the March 2022 issue of the American Economic Review: Insights.