Family Resource Allocation and the Distribution of Health Benefits of Air Pollution Control By:

Protecting human health is a central goal of environmental policy, but with the exception of the age distribution of mortality from air pollution, relatively little is known about the distribution of economic benefits of health improvements from pollution control. This paper examines the distribution within and between families using a model of family resource allocation. The model illustrates how the allocation of resources in families may influence the distribution of economic benefits between households. The model is estimated using data from a stated preference survey. Results suggest that economic benefits of a given acute health improvement vary markedly both within and between households, with a range exceeding 400% over groups defined by race, income, health status and age. Moreover, the distribution of benefits between racial or income groups does not appear to be constant, but rather varies with age and health status in a manner that depends on intra-household allocations.