When I think of pictures of Beijing, for example prior to the 2008 Summer Olympic games or those images shown in the 2015 documentary film Under the Dome, by Chai Jing, the last thing that comes to my mind are blue skies. This may change in the near future. According to Matt Kahn, Professor of Economics at the University of Southern California, Beijing and other Chinese cities have great prospects of having blue skies sooner rather than later.
Kahn spent a week in March as a visiting scholar at the Kleinman Center and gave an overview of his upcoming book, Blue Skies over Beijing: Economic Growth and the Environment in China (Princeton University Press, 2016), co-authored with Professor Siqi Zheng of Tsinghua University.
Kahn has no links to the Chinese government. His optimism, unusual among environmental economists, is based on simple data analysis of Chinese cities and the action taken by the population and the government at national and local levels.
Among the most striking facts that Kahn showed and for me, the main reason to be optimistic, was the decreasing trend in PM10 in Beijing in the last 15 years—despite the growth in the economy and population. PM10 is the air standard that focuses on smaller but very harmful particles able to reach the lower regions of the respiratory tract. This rapid reduction is remarkable when compared to the time it took London to regain its blue skies after the industrial revolution. It was not until the “Great Smog” of 1952 that London reached a bottom point and the government started to take measures to get rid of “peasoupers,” that infamous suffocating smog.
For Kahn, one of the most important reasons to believe in blue skies and a cleaner future in China is the behavior of its population towards pollution. He showed how much Chinese households value clean air. They are “voting with their feet” thanks to the relaxation of the “Hukou” system of household registrations (designed to prevent internal migrations) and the possibility to commute by bullet train. The rising demand for green cities has been reflected by higher real estate prices in places with greater environmental quality and less polluted air.
This trend and the overall demand for “blue skies” will persist as the population gets richer, more educated, and better informed about air quality. Providing these blue skies is essential not only to improve health conditions and overall quality of life, but also to develop human capital, a key factor of economic growth.
The Chinese government is well aware of this, as well as it is aware of the angry tweets on highly polluted days. As a result, there has been a “green push” by the central and local governments, another crucial reason for the blue optimism.
After Kahn’s lecture, perhaps the only reason to remain skeptical about a cleaner future in China, are the costs of the “green push.” Replacing cheap and abundant coal could be expensive. These costs could be translated into a loss of competitiveness, a major driver of Chinese economic growth. But perhaps like in London in the 50’s, the Chinese have reached a bottom when it comes to pollution tolerance. In a deference to public opinion that we usually associate with democracies, the choice appears to have been made for blue skies.