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CIREQ-CIRANO Workshop on Environmental and Natural Resource Economics

The CIREQ-CIRANO Workshop on Environmental and Natural Resource Economics is organized in collaboration with CIRANO and is joint with the economics departments of the universities of MontréalQuébec at MontréalMcGill and HEC Montréal.

The event is addressed to researchers and PhD students interested in natural resource and environmental economics.

*  Information on previous workshops can be found here.


1130, rue Sherbrooke Ouest, suite 1400
Montréal, QC H3A 2M8 

Registration for this event is free but mandatory.


Justin Kakeu (University of Prince Edward Island)
Multi-pollutant Cap-and-Trade Systems with Heterogeneous Firms: An Optimal Transport Approach
This study addresses the critical issue of simultaneous exposure to multiple air pollutants, a growing concern for policymakers. Traditional cap-and-trade markets, with their single-pollutant focus, fall short in managing the complex interactions of pollutants like carbon monoxide (CO), particulate matter (PM), nitrogen oxides (NOx), sulfur dioxide (SO2), and ozone (O3), which significantly impact human health and the environment. Our research introduces a novel multi-pollutant cap-and-trade system, designed to overcome these limitations. This system encompasses a variety of polluting firms and a pollution control authority issuing permits that bundle diverse pollutant rights. We innovate by using optimal mass transportation techniques to efficiently allocate these multi-pollutant permits across a heterogeneous array of firms. A decentralized approach allows for an equilibrium in permit pricing and provides a geometric characterization of firms based on their permit selection. Our analysis reveals strategic behaviors in permit selection and market segmentation within the multi-pollutant cap-and-trade framework. By implementing numerical simulations with computational geometry and optimal transport methods, we demonstrate the determination of permit prices and the optimal allocation of demand in a multi-pollutant market. This research represents a significant advancement in the economics of climate policy and air quality management, offering a more comprehensive and effective approach to tackling environmental challenges.

David Benatia (HEC Montréal & CIREQ)
Air Pollution and Children’s Health Inequalities
Co-authors : In collaboration with Milena Suarez-Castillo (DREES, PSE), Christine Le Thi (INSEE, OECD) and Vianney Costemalle (DREES)
This paper examines the differential impacts of early childhood exposure to air pollution on children’s health care use across parental income groups using French administrative data. In a quasi-experimental design, we make use of exogenous air pollution shocks induced by variations in local thermal inversion exposure across different birth cohorts and municipalities.
We find that temporary surges of air pollution exposure during early life stages significantly affect the likelihood of emergency admissions, doctor visits, and medication use related to respiratory problems in young children. We uncover large air pollution-related health inequalities between children by estimating the treatment effect heterogeneity with machine learning techniques. These detrimental health effects are concentrated among approximately 10\% of the infant population, who are not necessarily the most exposed but are mainly characterized by poor health indicators at birth and lower parental income. Our study demonstrates that prioritizing interventions in regions identified by simple vulnerability metrics yields more effective mitigation of adverse health impacts compared to strategies solely based on pollution exposure levels.

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