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α: calibrated so average coauthorship-adjusted count equals average raw count
Although there is strong evidence that oil and natural gas development lead to decreases in local ambient air quality, there is less evidence of a causal link between these activities and human health. This paper explores the environmental health costs of burning natural gas by-products during crude oil extraction – flaring. We estimate the impact of flared natural gas on respiratory health by using quasi-random variation in upwind flaring generated by the interaction of wind patterns and natural gas processing capacity. Specifically, we construct a novel dataset to estimate the causal effect of increased upwind flaring on the monthly respiratory-related hospital visitation rate by using the number of upwind wells that are connected to a capacity-constrained natural gas processing facility as an instrument for monthly upwind flaring. We find that a 1% increase in the amount of flared natural gas in North Dakota would increase the respiratory-related hospital visitation rate by 0.73%. Furthermore, zip codes that were exposed to more than half of all flared natural gas extracted less than 20% of all resource wealth during the sample time period, and the zip codes exposed to a disproportionate amount of flaring tend to be economically-disadvantaged and communities of color. Our estimates indicate that the health costs constitute a material portion of the external cost of flaring, and therefore ought to be considered in global initiatives to reduce flaring.