Fresh Air Eases Work – The Effect of Air Quality on Individual Investor Activity

Steffen Meyer, Michaela Pagel

Research output: Contribution to journalJournal articleResearchpeer-review


This paper shows that air quality has a significantly negative effect on the likelihood of individual investors to sit down, log in, and trade in their brokerage accounts controlling for investor-, weather-, traffic-, and market-specific factors. In perspective, a one standard deviation increase in fine particulate matter leads to the same reduction in the probability of logging in and trading as a one standard deviation increase in sunshine. We document this effect for low levels of pollution that are commonly found throughout the developed world. As individual investor trading can be a proxy for everyday cognitively-demanding tasks such as office work, our findings suggest that the negative effects of pollution on white-collar work productivity are much more severe than previously thought. To our knowledge, this is the first study to demonstrate a negative impact of pollution on a measure of white-collar productivity at the individual level in a western country.
Original languageEnglish
JournalNational Bureau of Economic Research. Working Paper Series
VolumeNo. 24048
Publication statusPublished - 2017
Externally publishedYes
EventSITE Summer Workshops 2017: Session 4: New Thinking about Economic Challenges in the Design and Implementation of Programs to Stabilize the Climate - Stanford University, Palo Alto, United States
Duration: 5. Jul 2017 → …


ConferenceSITE Summer Workshops 2017
LocationStanford University
Country/TerritoryUnited States
CityPalo Alto
Period05/07/2017 → …
Internet address

Bibliographical note

Author contact info: Steffen Meyer University of Southern Denmark Campusvej 55 5230 Odense M Denmark E-Mail: Michaela Pagel Columbia Business School 3022 Broadway Uris Hall New York, NY 10027 Tel: 212/854-1276 E-Mail:


  • Asset allocation


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