Information and avoidance behaviour: The effect of air pollution disclosure on labour supply in China

Abstract

Although many studies have documented the negative impact of pollution on labour supply, few have investigated how it is affected by pollution information disclosure. This article analyses the question by using the exogenous shock of the launch of China's air pollution information disclosure programme. By using the difference-in-differences method and survey data for migrant workers, the authors find that such disclosure significantly decreased the working hours of outdoor workers. These findings highlight the importance of information disclosure, which could result in changes in workers' behaviour. Moreover, they indicate that measuring the cost of pollution without addressing the problem of information asymmetry may lead to bias.