Leonard Moulin (INED)
Valeria Maria Urbano and Lorenzo Maraviglia
Congestion pricing policies have been implemented in several cities to reduce traffic congestion and mitigate environmental impacts in urban areas. However, the externalities of such policies may extend beyond traffic reduction, potentially generating indirect effects on health and, consequently, on childrens educational outcomes. This study examines the impact of the congestion charge Area C introduced in Milan in 2012 on the academic performance of primary school pupils. Using a difference-in-differences design and individual-level data from 20092018, we analyze students outcomes across grades and subjects based on standardized tests from INVALSI. Our findings show statistically significant positive effects for second-grade students in both Mathematics and Italian, while no significant effects emerge for fifth-grade students. Strikingly, the gains are concentrated among children whose parents hold lower-status occupations, leading to a measurable reduction in achievement gaps along parental occupational lines. Our results show that environmental regulation can generate meaningful equity-enhancing effects, narrowing early academic inequalities that mirror the socioeconomic structure of the city.