Environmental regulation, groundwater pollution, and health: Evidence from leaking underground storage tanks

Environmental regulations designed to reduce remediation cost and protect human health often require the adoption of new and costly technology, resulting in significant push-back from industry. While the costs of risk-reducing regulations are well known, identifying the health benefits of such endeavors is difficult due to issues of endogenous sorting, avoidance behaviors, and data limitations. Despite a growing body of literature documenting the relationship between air pollution and health, few papers have attempted to estimate the impact of groundwater and soil pollution on health in a developed world context. I analyze the effect of exposure to leaking underground storage tanks on infant health outcomes using Pennsylvania, New Jersey, and Florida vital statistics birth data containing confidential maternal address information in order to identify precise proximity of mothers to sites. Using underground storage tank databases from each state, I obtain leak timing data to determine exposure during gestation. By exploiting linked data on mothers over time, I estimate the difference in sibling outcomes between exposed and unexposed siblings for a mother living in close proximity to the site, relative to the sibling difference for a mother living farther from the site. I find that gestational exposure to a leaking tank increases both the probability of low birth weight and preterm birth by about 6 percent. Effects are larger for more disadvantaged mothers and mothers living outside public water supply areas who are more likely to utilize well water. This suggests that groundwater contamination is an important channel though which leaking tanks harm infant health. Additionally, I estimate the health benefit of underground storage tank regulations designed to reduce the risk of exposure. I find that tank upgrades mitigate entirely the effect of leaking underground storage tanks on low birth weight. Since mothers of low socio-economic status are most likely to live in close proximity to pollution sites, regulations designed to reduce the risk of exposure have the potential to improve health outcomes among this already disadvantaged group.