Valuation of the Health Effects

This chapter measures the value of health effects of air pollution for the Indian rural Punjab, where air pollution problem occurs from crop residue burning. Consumer choice model is used to get the monetary estimates of reduced air pollution level to the safe level. The chapter uses data of 625 individuals collected from a household level survey conducted in three villages in Indian Punjab for 150 households. To obtain the monetary values, Tobit and Poisson models are used to estimate mitigation expenditure and workdays lost equations, respectively. Total annual welfare loss in terms of health damages due to air pollution caused by the burning of rice straw in rural Punjab amounts to Rs 76 millions. If one also accounts for expenses on averting activities, productivity loss due to illness, monetary value of discomfort and utility and additional fertilizer, pesticides and irrigation, the losses would be much higher.