Fine particulate matter damages and value added in the US economy

Emissions of most pollutants that result in fine particulate matter (PM2.5) formation have been decreasing in the United States. However, this trend has not been uniform across all sectors or regions of the economy. We use integrated assessment models (IAMs) to compute marginal damages for PM2.5-related emissions for each county in the contiguous United States and match location-specific emissions with these marginal damages to compute economy-wide gross external damage (GED) due to premature mortality. We note 4 key findings: First, economy-wide, GED has decreased by more than 20% from 2008 to 2014. Second, while much of the air pollution policies have focused to date on the electricity sector, damages from farms are now larger than those from utilities. Indeed, farms have become the largest contributor to air pollution damages from PM2.5-related emissions. Third, 4 sectors, comprising less than 20% of the national gross domestic product (GDP), are responsible for similar to 75% of GED attributable to economic activities. Fourth, uncertainty in GED estimates tends to be high for sectors with predominantly ground-level emissions because these emissions are usually estimated and not measured. These findings suggest that policymakers should target further emissions reductions from such sectors, particularly in transportation and agriculture.