Estimating the cost of air pollution in South East Queensland: An application of the life satisfaction non-market valuation approach

Abstract

Making use of data from the Household, Income and Labour Dynamics in Australia (HILDA) survey coupled with air pollution data on PM10 exceedances generated by The Air Pollution Model (TAPM), this paper employs the life satisfaction approach to estimate the cost of PM10 exceedances from human activities in South East Queensland. This paper offers an estimate of the cost of PM10 exceedances from anthropogenic activities for the region of South East Queensland and provides further evidence on the association between air pollution (PM10 exceedances) and life satisfaction. A negative relationship is found between life satisfaction and the average number of days ambient concentrations of PM10 exceed health guidelines. This yields an implicit willingness-to-pay, in terms of annual household income, for pollution reduction of approximately AUD 5,000.