<p>This paper examines the medium and long-term human capital consequences of in-utero exposure to agricultural fires in rural China. We exploit exogenous variations in birth month, fire intensity, and wind direction to identify the causal effect of fetal exposure to fire. Our findings suggest that in-utero exposure to agricultural fires significantly reduces individuals’ health, cognitive, and non-cognitive performance in adolescence, with the effect primarily driven by the male sample. Tracking these cohorts into adulthood, we show that fire exposure decreases the number of years of education and earnings. Besides the transmission of adverse conditions in early life, a key mechanism driving the persistent effect of fetal exposure is that liquidity-constrained households reinforce the negative impacts by reallocating resources <i>away</i> from exposed children. Using the rollout of China’s New Cooperative Medical Scheme (NCMS) as a quasi-experiment, we present evidence that health insurance coverage can largely offset the effects of agricultural fire exposure by easing financial constraints and promoting parental investments. Our findings underscore the disproportionate cost of pollution on vulnerable rural families and&#xa0;have significant policy implications for mitigating the adverse effects of pollution exposure.</p>

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When the wind blows: agricultural fire exposure, parental investment, and long-term outcomes

  • Hai Hong,
  • Kevin Chen

摘要

This paper examines the medium and long-term human capital consequences of in-utero exposure to agricultural fires in rural China. We exploit exogenous variations in birth month, fire intensity, and wind direction to identify the causal effect of fetal exposure to fire. Our findings suggest that in-utero exposure to agricultural fires significantly reduces individuals’ health, cognitive, and non-cognitive performance in adolescence, with the effect primarily driven by the male sample. Tracking these cohorts into adulthood, we show that fire exposure decreases the number of years of education and earnings. Besides the transmission of adverse conditions in early life, a key mechanism driving the persistent effect of fetal exposure is that liquidity-constrained households reinforce the negative impacts by reallocating resources away from exposed children. Using the rollout of China’s New Cooperative Medical Scheme (NCMS) as a quasi-experiment, we present evidence that health insurance coverage can largely offset the effects of agricultural fire exposure by easing financial constraints and promoting parental investments. Our findings underscore the disproportionate cost of pollution on vulnerable rural families and have significant policy implications for mitigating the adverse effects of pollution exposure.