The Joint Clean Air Actions and air quality spillovers in China.

Facing severe air pollution in its North Plain, the central government of China initiated the Joint Clean Air Action (JCAA) in 2017 to facilitate pollution mitigation efforts across the region. While quite a few studies investigated the effectiveness of this regulation, much less attention is paid to the pollution spillover effects. We empirically examine the effects, and show that 1) air quality in the east of the target cities has been improved due to positive spillover of improved air quality under the JCAA; 2) the beneficiary spillover lasts for two seasons and disappeared in autumn and winter; 3) air quality in the north, south and west directions are almost not changed; 4) wind direction and topography, two determinants of atmospheric transport, have a considerable influence over the spillover effects. Our study provides a fresh perspective to understand the impacts of the JCAA policy and underlines the necessity of taking both pollution and air quality spillover effects into the cost-benefit analysis. Implications: Pollution regulations in one place may increase pollution in other places, as production and emissions are re-allocated under the incentives induced by regional-specific regulations. This phenomenon has long been recognized in the literature as pollution spillover. However, if the relevant production and emissions are not re-allocated, at least not re-allocated in large quantities, local air quality improvement induced by regulations may also benefit the neighboring areas. We call this effect air quality spillover. Both spillover effects should be rigorously evaluated, which is of scientific interest by itself and also contributes to a comprehensive cost-benefit analysis of environmental regulations.