The environments we live and work in affect our physiological functions and health, which in turn can affect behavior, productivity, and overall labor market performance. Air pollution in particular is a pervasive environmental issue with far-reaching consequences for human health and well-being, as has been suggested by e.g., Currie, Neidell, and Schmieder (2009), Currie et al. (2014), Greenstone and Hanna (2014), or Newell et al. (2018). Exposure to air pollution can affect human health even during the gestation period resulting in poorer health at birth (Chay and Greenstone 2003; Currie and Neidell 2005; Bharadwaj et al. 2017), which in turn negatively impacts human capital accumulation (Black et al. 2007; Zivin and Neidell 2013) and life-long health and labor market outcomes (Rangel and Vogl 2019). Poor health in childhood also affects labor markets indirectly as poorer development status in childhood can potentially decrease parents’ labor supply in terms of hours worked, and thus the household’s overall income (Lafférs and Schmidpeter 2021).

In this project we propose to investigate the effect of in-utero exposure on cognitive abilites of the children. Moreover, we plan to investigate how the negative effect of pollution on child's human capital affects productivity and social capital of their parents.