Mark Van Orden

Job Market Paper: Net Health Impacts of Industrialization: Water Pollution and Economic Spillovers During the WWI Steel Boom - Link to Paper 

Research Overview: Heavy industry has long driven economic development, but its net health impacts remain uncertain. While rapid industrialization may improve population health by raising incomes, it can also generate pollution that harms health. Moreover, these effects may fall unevenly across industrial centers and neighboring communities, making it unclear whether industrialization results in a net health benefit or harm, and for whom.

My job market paper examines the health trade-offs associated with the rapid growth of the steel industry during World War I. Increased demand for wartime armaments improved economic conditions in steel-specializing cities but exposed downriver communities to polluted drinking water. This uneven distribution of costs and benefits created geographic disparities in pollution exposure and income. I document the net health impacts across three treatment groups: steel-specializing cities with polluted drinking water, downriver cities with polluted drinking water, and steel-specializing cities with clean drinking water.

To estimate the impact of rapid steel industry growth on infant mortality, I combine individual-level infant mortality data with a novel dataset on steel production and public water sources. Using a difference-in-differences identification strategy, I compare infant mortality risks between cities with polluted water supplies (where water intakes were downriver from steel production) and control cities with unpolluted supplies, before and after WWI.

Exposure to polluted drinking water, which included heavy metals like lead, increased infant mortality risk by 3 percentage points (or 27%) on average. Notably, because the public was largely unaware of the presence and health impacts of heavy metals, this effect is unlikely to have been influenced by households’ pollution avoidance behaviors. Further, this effect cannot be attributed to air pollution or waterborne disease.

To isolate the health effects of economic benefits from those of pollution, I limit the sample to cities with unpolluted water sources (e.g., well water) and compare infant mortality risks between cities with and without steel production facilities. Economic exposure to the steel boom reduced infant mortality by 2 percentage points, suggesting a positive impact of industrialization when pollution is managed.

Finally, I estimate the net health impacts of industrialization by comparing infant mortality risk in cities with varying levels of exposure to the economic benefits and environmental costs of the steel boom. The results indicate that infant mortality risks from pollution were most severe in steel-specializing cities, where highly concentrated local pollution costs outweighed economic benefits, including higher manufacturing wages and city health expenditures. In contrast, downriver communities with milder pollution exposure were less affected, even without compensating economic benefits.

These findings contribute to the limited research on the health impacts of industrial water pollution and the health trade-offs of industrialization, underscoring the need for public policy that promotes equitable growth in industrializing nations.