Does haze pollution aggravate urban-rural income gap? Evidence from 283 prefecture-level cities in China.

Urban-rural income gap and haze pollution concerns are remained at top priority to achieve sustainable development objectives in China. Based on the panel data of 283 cities in China from 2008 to 2018, the quantile regression model is used to study the impact of haze pollution on the urban-rural income gap. In addition, we adopt ventilation coefficients as the instrumental variable of haze pollution to control for potential endogeneity. Findings obtained from the quantile regression estimator suggest that haze pollution can significantly increase the urban-rural income gap. The effect of haze pollution on urban-rural income gap is more significant in the low quantile than the high quantile state. After alleviating endogenous bias through instrumental variables, the promotion effect is more obvious. Furthermore, haze pollution affects the urban-rural income gap through healthy human capital. Our results shed new light on the relationship between haze pollution and urban-rural income gap and provide support for policymakers in tackling the dual tasks of urban-rural income gap and haze pollution. A less haze pollution, our findings suggest, may exert positive effects in relation to the mitigation of urban-rural income gap in China.