Air pollution is the leading environmental killer worldwide; its microeconomic impact, however, is not well understood. Our first publication of 2024 explores the relationship between consumer spending and ambient air pollution using data from Spain to help fill that knowledge gap: https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0292245
Our study specifically examines the relationship between fine particulate matter (PM 2.5) and ozone (O3, the main cause of smog) ambient air concentration and consumer spending in brick and mortar stores. We suspected that on days with higher pollution, consumers would be more likely to exhibit avoidant behavior, resulting in fewer purchases on smoggier days.
Chart showing daily PM2.5 concentration, ozone concentration, and spending in Euros from January to December 2014.
The data presents a mixed picture. Correlational analysis found a weak correlation between O3 concentration and consumer spending and no significant pattern between PM2.5 concentration and consumer spending. Further, we do not observe a sufficiently strong bounce-back in consumer spending in the day–or even the week–following higher ozone concentration.
There were also age differences in avoidant behavior; consumers under 25 and above 44 were more likely than 25-44 year old consumers to curb spending on days with higher O3 pollution.
Plot of ozone’s effect on consumer spending in different age groups with a 95% CI.
Ultimately, this research begins to try to account for a previously unconsidered consequence of air quality, even in regions where air quality is deemed safe by World Health Organization standards.
Explore all our findings here: https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0292245
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