Research

Abstract: Air pollution disperses across political boundaries, yet many environmental policies regulate specific polluted locations. This paper studies how cross-boundary transport of fine particulate matter PM2.5 changes the welfare effect and design of pollutant control policy in China. Using particle trajectory data from atmospheric transport models, we construct bilateral flow matrices that measure the transboundary air pollution in China. Three patterns emerge: (1) Transboundary pollution is heterogeneous across space, ranging from less than 10% to over 50% of local PM2.5 concentrations; (2) Bilateral pollutant transport networks remain stable over time, enabling long-term policy coordination without frequent recalibration; and (3) Economically developed provinces in China receive more transboundary pollution yet achieve larger pollution reduction. We develop a dynamic spatial general equilibrium model that incorporates pollutant transport, trade, and migration. Using this model, we estimate that transboundary air pollution creates a 1% national welfare loss relative to a counterfactual where pollution remains local. We evaluate China's Air Pollution Prevention and Control Action Plan and compare it to alternative allocation rules. Reallocating abatement to high-spillover upwind provinces based on marginal social welfare of emission tax improves aggregate welfare by 0.18% relative to the actual policy. The findings reveal welfare gains from accounting for spatial externalities in policy design.

[Draft] 

1. Trade Liberalisation, Informality and Gender Employment Gap: Evidence from Brazil

2. The Non-economic Effect of Trade: the International Spillover of Air Pollution (Joint with Antonio Avila-Uribe, Ningyuan Jia)

3. The Economic Geography of Talent: Evidence from the China Initiative (Joint with Jia Yang, Ningyuan Jia)

4. Digitizing the Supply Chain: Evidence from Indian Firms (Joint with Animesh Jayant)

5. Battling Emissions: Green Transition in Steel Industry (Joint with Yuxiao Hu)