This paper estimates the causal effect of the Nitrogen Oxide Budget Program (NBP), a regional cap-and-trade regulation targeting ozone pollution, on infant mortality in the United States. Exploiting the program’s staggered adoption across states and its restriction to summer months, we use county-level data from 1996–2009 to identify variation in prenatal pollution exposure. Prenatal exposure to the NBP reduced infant mortality by approximately 4–5 percent, with larger effects in the earliest months of life. Instrumental-variables estimates confirm that reductions in ambient ozone are the primary mechanism.
Toranji et al. (Mon,) studied this question.