Cleaning Lahore's air: Information creation and disclosure
This project assesses the impact of disclosing third-party data on firms' emissions and adoption of air pollution control equipment in Lahore.
The significant economic impact of air pollution makes regulatory compliance crucial in Pakistan. Continuous exposure to high levels of particulate matter in cities such as Lahore reduces life expectancy by 7.5 years (Greenstone and Haskenkopf, 2023), and air pollution in Pakistani cities causes welfare losses amounting to 6% of GDP (World Bank, 2018).
As traditional strategies (command-and-control) have been ineffective in enhancing air quality in cities like Lahore, environmental regulators need to explore alternative approaches to tackle air pollution. Implementing information disclosure strategies, like emissions rating programs, can incentivise industrial plants to adhere to emission standards and maintain minimal pollution levels.
Regulators' limited capacity to frequently monitor emissions creates an opportunity for third-party sources to gather and share emissions data. This project engages with the Punjab Environmental Protection Department (EPD) and civil society representatives to experimentally assess the impact of disclosing third-party emissions data on firms' emissions and technology (air pollution control equipment) adoption.
By sharing firms' emissions ratings with the EPD and civil society, the project aims to examine: (i) if this information-sharing prompts regulators to intensify enforcement; (ii) if firms enhance compliance due to pressure from regulators and civil society and; (iii) whether regulators or civil society incite greater changes in firm behaviour.