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Speaker:
Christian König (Berlin Social Science Center)

ONLINE presentation

Voluntary Environmental Information Programs and Individual Transportation Behavior - Evidence from Stuttgart's Particulate Matter Alert

Abstract
One of the central debates in the environmental management and public policy is about the effectiveness of voluntary and information based approaches (VIBAs) - as opposed to legal regulations and market-based instruments. VIBAs have clear comparative advantages in terms of political feasibility and acceptance, but the empirical evidence regarding their efficacy is mixed.
Using 25 million traffic monitor readings between 2016-2018 from the local authority and meteorological satellite data from NASA, this study analyzes whether individuals respond to ’Particulate Matter Alerts’ (PMAs) in Stuttgart (Germany) by voluntarily foregoing usage of their car. Stuttgart is a particularly relevant case, as local air pollution levels have been violating EU regulations for years leading the European Commission to sue Germany and the city of Stuttgart to introduce driving bans in early 2019. Naive OLS estimates on the causal effect of PMAs on traffic flows are likely to suffer from reverse causality because the PMA triggering rule is a function of pollution concentration that, in turn, is clearly affected by road traffic. I employ a new and innovative instrumental variable - nighttime vertical temperature differentials - using NASA satellite data on atmospheric temperature profiles to introduce reasonably exogenous variation in the treatment variable.
The analysis demonstrates that a PMA reduces daily traffic volume by almost 8%, indicating a significant effect of the program on individuals’ short-term transportation behavior. These results are robust to several alternative regression models and the use of different specifications of the instrumental variable.

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