Mismatched Social Welfare Allocation and PM2.5-Related Health Damage along Value Chains within China

The different value chain roles led tosignificant mismatchesbetween social welfare gains and health damage across regions. Themismatches were partially reduced with the effects of atmospherictransport at the expense of an increase in health damage in denselypopulated and lower polluted regions. Value chains have played a critical part in the growth.However,the fairness of the social welfare allocation along the value chainis largely underinvestigated, especially when considering the harmfulenvironmental and health effects associated with the production processes.We used fine-scale profiling to analyze the social welfare allocationalong China's domestic value chain within the context of environmentaland health effects and investigated the underlying mechanisms. Ourresults suggested that the top 10% regions in the value chain obtained2.9 times more social income and 2.1 times more job opportunitiesthan the average, with much lower health damage. Further inspectionshowed a significant contribution of the "siphon effect"majorresource providers suffer the most in terms of localized health damagealong with insufficient social welfare for compensation. We foundthat inter-region atmosphere transport results in redistribution for53% health damages, which decreases the welfare-damage mismatch at"suffering" regions but also causes serious health damageto more than half of regions and populations in total. Specifically,around 10% of regions have lower social welfare and also experienceda significant increase in health damage caused by atmospheric transport.These results highlighted the necessity of a value chain-oriented,quantitative compensation-driven policy.