Brownish Green
Did shale gas green the U.S. economy?
David Lindequist & Samuel Selent
Energy Economics, May 2025
Abstract:
Since the mid-2000s, hydraulic fracturing (’fracking’) has significantly altered the U.S. energy landscape through a surge in shale gas production. Employing synthetic control methods, we evaluate the effect of the shale gas boom on U.S. emissions and various energy metrics. We find that the boom reduced average annual greenhouse gas emissions per capita by roughly 7.5%. Drawing on the existing literature on the environmental impact of shale gas, we decompose this overall treatment effect into changes in the fossil fuel mix (the substitution effect), changes in the speed of the transition to non-fossil energy sources (the transition effect), and changes in overall energy consumption (the consumption effect). Our results indicate that the estimated treatment effect is attributable to an energy mix in which natural gas replaces coal, an accelerated transition to renewable energies, and a decrease in energy consumption, largely driven by decreases in energy intensity. Our findings highlight the role of shale gas as a ’bridge fuel’ for the U.S. economy between 2007 and 2019, an energy source facilitating the transition from carbon-intensive fossil fuels to cleaner energy sources.
Unintended consequences of environmental regulation of maritime shipping: Carbon leakage to air shipping
Volodymyr Lugovskyy, Alexandre Skiba & David Terner
Journal of International Economics, May 2025
Abstract:
We assess the expected impact of the upcoming International Maritime Organization’s CO2 emissions cap on global maritime shipping. Using detailed data on U.S. imports -- covering vessels, routes, emissions, and trade -- we estimate a model that allows for substitution between maritime, air, and land transport. Our findings show that the cap will drive a shift to more carbon-intensive air and land transport, leading to an overall increase in transportation-related CO2 emissions in both the short- and long-run. Additionally, it will cause significant welfare losses. Our findings support a case for more efficient alternative policy options.
Sustainability or Greenwashing: Evidence from the Asset Market for Industrial Pollution
Ran Duchin, Janet Gao & Qiping Xu
Journal of Finance, April 2025, Pages 699-754
Abstract:
We study the asset market for pollutive plants. Firms divest pollutive plants in response to environmental pressures. Buyers are firms facing weaker environmental pressures that have supply chain relationships or joint ventures with the sellers. While pollution levels do not decline following divestitures, sellers highlight their sustainable policies in subsequent conference calls, earn higher returns as they sell more pollutive plants, and benefit from higher Environmental, Social, and Governance (ESG) ratings and lower compliance costs. Overall, the asset market allows firms to redraw their boundaries in a manner perceived as environmentally friendly without real consequences for pollution but with substantial gains from trade.
Private Benefits from Public Investment in Climate Adaptation and Resilience
Jacob Bradt & Joseph Aldy
NBER Working Paper, March 2025
Abstract:
Flood protection infrastructure investments, such as Army Corps of Engineers levees, can enhance resilience to flood risks amplified by climate change. We estimate levees’ benefits by exploiting repeat residential property transactions. In areas protected by levees, home values increase 3-4 percent. Levees impose adverse spillover flood risks that reduce home values in nearby areas by 1-5 percent. Capitalized benefits in protected areas are progressive, but adverse spillover impacts are regressive. Capitalized benefits at levee construction do not vary by race, but racial sorting occurs post-construction. The local political economy of levee construction can explain the distribution of winners and losers.
Economic costs of wind erosion in the United States
Irene Feng et al.
Nature Sustainability, March 2025, Pages 307-314
Abstract:
Wind erosion and resulting dust negatively impact the environment and society, but there has been no comprehensive assessment of costs to the United States since the 1990s. Climate and society have changed greatly since then, including changing dustiness, spiking Valley fever infections and increased renewable energy use. By adopting published estimates and calculating emerging costs, we estimate that wind erosion and dust in the United States cost $154.4 billion annually (2017 value). This estimate quadruples the previous assessment and is higher than most other US weather and climate disasters. We also discovered many costs associated with wind erosion that are not accounted for. Our estimate, while conservative, reveals that the economic burden of wind erosion is substantial and investment in dust mitigation could yield large economic benefits.
Leaf absorption contributes to accumulation of microplastics in plants
Ye Li et al.
Nature, forthcoming
Abstract:
Plant absorption is important for the entry of many pollutants into food chains. Although terrestrial microplastics (MPs) can be absorbed by the roots, their upward translocation is slow. Meanwhile, atmospheric MPs are widely present, but strong evidence on their direct absorption by plants is still lacking. Here, analyses using mass spectrometry detection show the widespread occurrence of polyethylene terephthalate (PET) and polystyrene (PS) polymers and oligomers in plant leaves, and identify that their levels increase with atmospheric concentrations and the leaf growth duration. The concentrations of PET and PS polymers can reach up to 104 ng per g dry weight in leaves at the high-pollution areas studied, such as the Dacron factory and a landfill site, and 102–103 ng per g dry weight of PET and PS can be detected in the open-air-grown leafy vegetables. Nano-sized PET and PS particles in the leaves were visually detected by hyperspectral imaging and atomic force microscopy–infrared spectroscopy. Absorption of the proactively exposed non-labelled, fluorescently labelled or europium-labelled plastic particles by maize (Zea mays L.) leaves through stomatal pathways, as well as their translocation to the vascular tissue through the apoplastic pathway, and accumulation in trichomes was identified using hyperspectral imaging, confocal microscopy and laser-ablation inductively coupled plasma mass spectrometry. Our results demonstrate that the absorption and accumulation of atmospheric MPs by plant leaves occur widely in the environment, and this should not be neglected when assessing the exposure of humans and other organisms to environmental MPs.
Phosphate-enabled mechanochemical PFAS destruction for fluoride reuse
Long Yang et al.
Nature, 3 April 2025, Pages 100-106
Abstract:
Perfluoroalkyl and polyfluoroalkyl substances (PFASs) are persistent, bioaccumulative and anthropogenic pollutants that have attracted the attention of the public and private sectors because of their adverse impact on human health. Although various technologies have been deployed to degrade PFASs with a focus on non-polymeric functionalized compounds (perfluorooctanoic acid and perfluorooctanesulfonic acid), a general PFAS destruction method coupled with fluorine recovery for upcycling is highly desirable. Here we disclose a protocol that converts multiple classes of PFAS, including the fluoroplastics polytetrafluoroethylene and polyvinylidene fluoride, into high-value fluorochemicals. To achieve this, PFASs were reacted with potassium phosphate salts under solvent-free mechanochemical conditions, a mineralization process enabling fluorine recovery as KF and K2PO3F for fluorination chemistry. The phosphate salts can be recovered for reuse, implying no detrimental impact on the phosphorus cycle. Therefore, PFASs are not only destructible but can now contribute to a sustainable circular fluorine economy.
Invisible Barrier: The Impact of Air Quality on Chronic School Absenteeism in the US
Mustahsin Aziz & Levan Elbakidze
Environmental and Resource Economics, March 2025, Pages 655-680
Abstract:
Persistent school absence can harm learning outcomes and lead to substantial socioeconomic setbacks. While regional studies have documented the connection between overall school attendance and air quality, the impact of air pollution on chronic absenteeism, which matters most for socioeconomic outcomes, remains unexplored. We address this gap using a national sample of K-12 schools and data for six criteria air pollutants monitored by the U.S. Environmental Protection Agency (EPA). We find a statistically significant and heterogeneous impact of air pollution on chronic absenteeism, even when pollution is below the EPA-recommended thresholds. Using wind direction as an instrumental variable, we find that an additional bad CO, NO2, or PM2.5 air quality day can increase chronic absenteeism by 0.6%, 0.2%, and 0.2%, respectively. These estimates suggest that an additional bad air quality day across the U.S. can increase the number of chronically absent students by up to 54,000 annually. We also document the uneven distribution of the impact on chronic absenteeism across racial, income, and age demographics. With a documented systematic impact of air quality on school attendance, our work adds valuable insights to the ongoing conversation about environmental impacts on education.
Wind Turbines, Shadow Flicker, and Real Estate Values
Carsten Andersen & Timo Hener
Environmental and Resource Economics, March 2025, Pages 731-759
Abstract:
We analyze the impact of wind turbines on house prices, distinguishing between effects of proximity and shadow flicker from rotor blades covering the sun. By utilizing data from 2.4 million house transactions and 6,878 wind turbines in Denmark, we can control for house fixed effects in our estimation. Our results suggest strong negative impacts on house prices, with reductions of up to 12 percent for modern giant turbines. Homes affected by shadow flicker experience an additional decrease in value of 8.1 percent. Our findings suggest a nuanced perspective on the local externalities of wind turbines regarding size and relative location.
Environmental enforcement actions and corporate green innovation
Qiyang He & Buhui Qiu
Journal of Corporate Finance, April 2025
Abstract:
This study explores the influence of U.S. Environmental Protection Agency (EPA) enforcement on corporate green innovation, as measured by green patent counts and citations. Our findings show that EPA-enforced firms experience a substantial uptick in green innovation outputs. This boost can be attributed to enhanced green innovation efficiency and increased hiring of green inventors. Moreover, this effect is more pronounced for firms headquartered in states with stronger environmental enforcement intensity, firms with higher institutional ownership, and firms with fewer financial constraints. Finally, we find that green innovations help enforced firms avoid future EPA enforcements and reduce toxic chemical releases. Taken together, these results imply that EPA enforcement actions can indeed foster positive impacts on corporate green innovation.