The Impact of the Clean Air Act on Particulate Matter in the 1970s.

We examine whether counties designated as out of attainment with the National Ambient Air Quality Standards (NAAQS) under the 1970 CAA experienced larger reductions in Total Suspended Particulates (TSP) during the 1970s than attainment counties. We answer this question using the official designation of nonattainment status which, between 1972 and 1978, was by Air Quality Control Region (AQCR). Data from balanced panels of TSP monitors in operation from 1969-78 and from 1971-78 are used to examine the impact of nonattainment status on TSP. We also examine the impact of nonattainment on TSP using the definition in the literature, which designates a county as out of attainment if any of its monitors violated the NAAQS. Using the official (AQCR) nonattainment designation, TSP, on average, fell by 10.2 μg/m3 using the 1969 panel and 9.1 μg/m3 using the 1971 panel. Using the definition of nonattainment in the literature yields smaller reductions: 6.0 μg/m3 using the 1969-78 panel and 7.7 μg/m3 using the 1971-78 panel. Using the correct definition of nonattainment in difference-in-differences (DID) models calls into question whether these results can be interpreted as causal. When counties are characterized using the official nonattainment designation, the parallel trends assumption, crucial to causal inference in the DID context, is violated.