Michael Greenstone is an American
economist
An economist is a professional and practitioner in the social sciences, social science discipline of economics.
The individual may also study, develop, and apply theories and concepts from economics and write about economic policy. Within this ...
and the Milton Friedman Distinguished Service Professor in Economics, the College, and the
Harris School of Public Policy
The University of Chicago Harris School of Public Policy, also referred to as "Harris Public Policy," is the public policy school of the University of Chicago in Chicago, Illinois, United States. It is located on the University's main campus in Hy ...
at the
University of Chicago
The University of Chicago (UChicago, Chicago, U of C, or UChi) is a private research university in Chicago, Illinois. Its main campus is located in Chicago's Hyde Park neighborhood. The University of Chicago is consistently ranked among the b ...
. He serves as director of the
Energy Policy Institute at the University of Chicago (EPIC), director of the
Becker Friedman Institute
The Gary Becker Milton Friedman Institute for Research in Economics is a collaborative, cross-disciplinary center for research in economics. The institute was established at the University of Chicago in June 2011. It brought together the activit ...
, and co-chair of the Energy and Environment sector at
Abdul Latif Jameel Poverty Action Lab
The Abdul Latif Jameel Poverty Action Lab (J-PAL) is a global research center working to reduce poverty by ensuring that policy is informed by scientific evidence. J-PAL conducts randomized impact evaluations to answer critical questions in the fi ...
(J-PAL). Under the first
Obama administration, he served as chief economist on the
Council of Economic Advisors
The Council of Economic Advisers (CEA) is a United States agency within the Executive Office of the President established in 1946, which advises the President of the United States on economic policy. The CEA provides much of the empirical resea ...
. His research interests focus on the nexus between
development economics
Development economics is a branch of economics which deals with economic aspects of the development process in low- and middle- income countries. Its focus is not only on methods of promoting economic development, economic growth and structural ...
and
environmental economics
Environmental economics is a sub-field of economics concerned with environmental issues. It has become a widely studied subject due to growing environmental concerns in the twenty-first century. Environmental economics "undertakes theoretical or ...
.
Biography
Born in the
United States
The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territorie ...
, Michael Greenstone earned a
B.A.
Bachelor of arts (BA or AB; from the Latin ', ', or ') is a bachelor's degree awarded for an undergraduate program in the arts, or, in some cases, other disciplines. A Bachelor of Arts degree course is generally completed in three or four yea ...
in economics with High Honors from
Swarthmore College
Swarthmore College ( , ) is a Private college, private Liberal arts colleges in the United States, liberal arts college in Swarthmore, Pennsylvania. Founded in 1864, with its first classes held in 1869, Swarthmore is one of the earliest coeduca ...
in 1991, where he starred and lettered for the men’s basketball team, and a
Ph.D
A Doctor of Philosophy (PhD, Ph.D., or DPhil; Latin: or ') is the most common Academic degree, degree at the highest academic level awarded following a course of study. PhDs are awarded for programs across the whole breadth of academic fields ...
in economics from
Princeton University
Princeton University is a private university, private research university in Princeton, New Jersey. Founded in 1746 in Elizabeth, New Jersey, Elizabeth as the College of New Jersey, Princeton is the List of Colonial Colleges, fourth-oldest ins ...
in 1998. Thereafter, he worked as a
Robert Wood Johnson Scholar at the
University of California, Berkeley
The University of California, Berkeley (UC Berkeley, Berkeley, Cal, or California) is a public land-grant research university in Berkeley, California. Established in 1868 as the University of California, it is the state's first land-grant u ...
(UCB, 1998-2000) before becoming an assistant professor of economics at the
University of Chicago
The University of Chicago (UChicago, Chicago, U of C, or UChi) is a private research university in Chicago, Illinois. Its main campus is located in Chicago's Hyde Park neighborhood. The University of Chicago is consistently ranked among the b ...
(2003–06). In 2006, Greenstone moved to
MIT
The Massachusetts Institute of Technology (MIT) is a private land-grant research university in Cambridge, Massachusetts. Established in 1861, MIT has played a key role in the development of modern technology and science, and is one of the m ...
, first as associate professor (2003–06) and then as the 3M Professor of Environmental Economics (2006–14). During his tenure at MIT, Greenstone also held visiting appointments at UCB, the University of California Energy Institute, and
Stanford University
Stanford University, officially Leland Stanford Junior University, is a private research university in Stanford, California. The campus occupies , among the largest in the United States, and enrolls over 17,000 students. Stanford is consider ...
. Most recently, in 2014, he followed a call back to the University of Chicago, where he was made the Milton Friedman Professor in Economics and the College. At the University of Chicago, he further holds positions as director of the
Becker Friedman Institute for Economics (BFI), director of the
Energy Policy Institute at Chicago (EPIC), and faculty director of the Environment and Energy Lab at the University's Urban Labs. Additionally, Greenstone currently serves among else as co-chair of
J-PAL's Environment and Energy sector (with
Mushfiq Mobarak), director of the Energy Research Programme at the
International Growth Centre
The International Growth Centre (IGC) is an economic research centre based at the London School of Economics, operated in partnership with University of Oxford's Blavatnik School of Government.
The centre was launched in December 2008 and is fund ...
(IGC), faculty director of the E2e Project, a fellow of the
American Academy of Arts and Sciences
The American Academy of Arts and Sciences (abbreviation: AAA&S) is one of the oldest learned societies in the United States. It was founded in 1780 during the American Revolution by John Adams, John Hancock, James Bowdoin, Andrew Oliver, and ...
and a non-resident senior fellow at the
Brookings Institution
The Brookings Institution, often stylized as simply Brookings, is an American research group founded in 1916. Located on Think Tank Row in Washington, D.C., the organization conducts research and education in the social sciences, primarily in ec ...
. In the past, he has been e.g. a chief economist on the
Council of Economic Advisors
The Council of Economic Advisers (CEA) is a United States agency within the Executive Office of the President established in 1946, which advises the President of the United States on economic policy. The CEA provides much of the empirical resea ...
(2009–10) under the first
Obama administration, a member of the advisory board to the
Secretary of Energy
The United States secretary of energy is the head of the United States Department of Energy, a member of the Cabinet of the United States, and fifteenth in the presidential line of succession. The position was created on October 1, 1977, when Pr ...
under the
Trump administration
Donald Trump's tenure as the List of presidents of the United States, 45th president of the United States began with Inauguration of Donald Trump, his inauguration on January 20, 2017, and ended on January 20, 2021. Trump, a Republican Party ...
(2015–17), a co-director of IGC's Climate Change, Environment and Natural Resources Research programme (2010–13), and a director of the
Hamilton Project The Hamilton Project is an economic policy initiative within the Brookings Institution. It was originally launched in April 2006 by a combination of public policy makers, business people, academic leaders, and other former Clinton administration ec ...
(2010–13). Finally, in terms of professional service, Michael Greenstone sits on the board of editors of the ''
Review of Environmental Economics and Policy
The Review of Environmental Economics and Policy (REEP) is a peer-reviewed journal of environmental economics published twice each year. It is the official "accessible" journal of the Association of Environmental and Resource Economists (AERE), ...
'' and has been an editor of the ''
Journal of Political Economy
The ''Journal of Political Economy'' is a monthly peer-reviewed academic journal published by the University of Chicago Press. Established by James Laurence Laughlin in 1892, it covers both theoretical and empirical economics. In the past, the ...
'' (2015–17), ''
Review of Economics and Statistics
''The'' ''Review of Economics and Statistics'' is a peer-reviewed 103-year-old general journal that focuses on applied economics, with specific relevance to the scope of quantitative economics. The ''Review'', edited at the Harvard University’s K ...
'' (2007-10), and held positions on the boards of editors of the ''
American Economic Journal: Economic Policy'' and the ''
Journal of Economic Literature
The ''Journal of Economic Literature'' is a peer-reviewed academic journal, published by the American Economic Association, that surveys the academic literature in economics. It was established in 1963 as the ''Journal of Economic Abstracts'', ''.
Michael Greenstone is married to Katherine Ozment, a
secularist
Secularism is the principle of seeking to conduct human affairs based on secular, naturalistic considerations.
Secularism is most commonly defined as the separation of religion from civil affairs and the state, and may be broadened to a sim ...
writer.
Research
Michael Greenstone's research interests include
environmental economics
Environmental economics is a sub-field of economics concerned with environmental issues. It has become a widely studied subject due to growing environmental concerns in the twenty-first century. Environmental economics "undertakes theoretical or ...
,
energy economics
Energy economics is a broad scientific subject area which includes topics related to supply and use of energy in societies. Considering the cost of energy services and associated value gives economic meaning to the efficiency at which energy c ...
,
public finance
Public finance is the study of the role of the government in the economy. It is the branch of economics that assesses the government revenue and government expenditure of the public authorities and the adjustment of one or the other to achiev ...
,
development economics
Development economics is a branch of economics which deals with economic aspects of the development process in low- and middle- income countries. Its focus is not only on methods of promoting economic development, economic growth and structural ...
,
labour economics, and
health economics
Health economics is a branch of economics concerned with issues related to efficiency, effectiveness, value and behavior in the production and consumption of health and healthcare. Health economics is important in determining how to improv ...
.; in particular, he is a pioneer of the study of environmental issues in
developing countries
A developing country is a sovereign state with a lesser developed industrial base and a lower Human Development Index (HDI) relative to other countries. However, this definition is not universally agreed upon. There is also no clear agreem ...
, an emerging field dubbed "envirodevonomics". According to
IDEAS/RePEc
Research Papers in Economics (RePEc) is a collaborative effort of hundreds of volunteers in many countries to enhance the dissemination of research in economics. The heart of the project is a decentralized database of working papers, preprints, ...
, he currently (February 2018) belongs to the top 1% of highest ranked economists in terms of research publications.
Economic effects of air pollution
How does air pollution affect economic outcomes? To investigate this question, Michael Greenstone and Kenneth Y. Chay use geographic variation in the reduction of air pollution due to the 1981-82 recession to estimate the impact of air pollution on
infant mortality
Infant mortality is the death of young children under the age of 1. This death toll is measured by the infant mortality rate (IMR), which is the probability of deaths of children under one year of age per 1000 live births. The under-five morta ...
in the U.S.; they find that reducing TSPs by 1% results in a 0.35% decline in the county-level mortality rate of infants, with most of the reduction concerning newborn deaths, in particular among
Afro Americans
African Americans (also referred to as Black Americans and Afro-Americans) are an Race and ethnicity in the United States, ethnic group consisting of Americans with partial or total ancestry from sub-Saharan Africa. The term "African American ...
. In another study with Chay, Greenstone exploits the impact of the U.S.
1970 and 1977 amendments to the Clean Air Act, which set a federal ceiling for
total suspended particulates (TSPs), empowered the newly created
Environmental Protection Agency
A biophysical environment is a biotic and abiotic surrounding of an organism or population, and consequently includes the factors that have an influence in their survival, development, and evolution. A biophysical environment can vary in scale f ...
to designate "non-attainment" counties in excess of that ceiling, and to impose strict air quality regulations on polluters in such counties, on housing prices, to study the relationship between housing prices and air quality. They find that the legislation was effective in reducing TSP air pollution and, based on an elasticity of housing values with regard to TSP concentration ranging from -0.20 to -0.35, that the improvements in air quality between 1970 and 1980 attributable to the regulations imposed under the non-attainment designation caused an increase of housing values in non-attainment counties worth $45 billion. However, Greenstone also finds that the Clean Air Act's non-attainment designation probably played only a minor role in the 80% reduction of
sulfur dioxide
Sulfur dioxide (IUPAC-recommended spelling) or sulphur dioxide (traditional Commonwealth English) is the chemical compound with the formula . It is a toxic gas responsible for the odor of burnt matches. It is released naturally by volcanic activ ...
(SO2) concentrations in the
United States
The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territorie ...
, possibly because regulators assigned the SO2 non-attainment designation to many counties that hadn't even exceeded SO2 ceilings for a single day and consequently didn't impose excessively strict regulatory oversight. Finally, Greenstone also analysed the impact of the 1970 and 1977 Clean Air Act Amendments on industrial activity in the U.S. and found that pollution-intensive in "non-attainment" counties lost ca. 590,000 jobs, $37 billion in capital stock, and $75 billion (at 1987 U.S. dollars) of output over 1972-87 as a consequence of the greater regulatory oversight exercised by EPA.
Economic effects of climate change
Together with Olivier Deschênes, Michael Greenstone initially found that climate change will increase agricultural profits in the U.S. over 2010-2100 by an average of $1.3 billion per year (in 2002 U.S. dollars) and that the measurement of climate change effects on land prices (the hedonic approach) is extremely sensitive to seemingly minor choices about control variables, sample, and weighting. However, following Fisher et al.'s (2012) critique with regard to data coding errors and conceptual oversights in Deschênes and Greenstone (2007), Deschênes and Greenstone subsequently re-estimated climate change to ''decrease'' U.S. agricultural profits by $4.5 billion per year over 2010-2100. In another collaboration, Greenstone and Deschênes study the relationship between climate change and mortality and its mitigation through adaptation, and estimate that under "business-as-usual" scenarios climate change will increase the age-adjusted mortality rate in the U.S. by 3% by the end of the 21st century, though this effect may be strongly mitigated through populations adapting to the expected increase in the frequency of extreme temperature days.
Environmental and energy economics
Together with Hunt Allcott, Greenstone reconsiders the evidence in favour of an
energy efficiency gap, i.e. whether consumers and firms fail to invest as much into energy efficiency as the expected increases in terms of utility or profits due to such investments would warrant. Overall, they cannot substantiate claims of a widespread energy efficiency gap, though their differentiation of specific investment inefficiency types leads them to conclude that policies aimed at addressing a supposed energy efficiency gap must be targeted to those consumer subject to investment inefficiencies if they are to be at all effective.
How much do people value the removal of
hazardous waste
Hazardous waste is waste that has substantial or potential threats to public health or the environment. Hazardous waste is a type of dangerous goods. They usually have one or more of the following hazardous traits: ignitability, reactivity, co ...
? Investigating this question, Greenstone and Justin Gallagher use a
regression discontinuity design
In statistics, econometrics, political science, epidemiology, and related disciplines, a regression discontinuity design (RDD) is a quasi-experimental pretest-posttest design that aims to determine the causal effects of interventions by assigning a ...
to compare the reaction of housing market prices at hazardous waste sites that narrowly qualified to benefit from
Superfund
Superfund is a United States federal environmental remediation program established by the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA). The program is administered by the United States Environmental Pro ...
cleanups relative to those who narrowly missed qualifying. They find the reaction to be economically small and statistically insignificant, suggesting that the average local benefits of Superfund cleanups are likely to be much lower than the cleanups' average cost of $43 million.
In environmental economics as well as in other areas, Greenstone has strongly advocated for the greater application of (quasi-)experimental methods to identify which policies are effective and efficient in terms of increasing social welfare.
Miscellany
How does the opening of a new manufacturing plant affect the productivity of incumbent manufacturing plants? Studying this question with
Richard Hornbeck and
Enrico Moretti
Enrico Moretti is an Italian economist and the Michael Peevey and Donald Vial Professor of Economics at the University of California, Berkeley. He is also a research associate at the National Bureau of Economic Research (Cambridge), and a researc ...
, Greenstone finds that
the TFP of incumbent plants in counties that were selected as the site for the opening of a new plant increase 12% more than in their runner-up competitors, with the agglomeration spillovers being particularly large if the old and new plants are similar. However, they also find that the wage growth in "winning" counties caused by the increased local labour demand tends to exceed productivity growth, thus reducing plant profits.
Exploiting the 1987 federal permission to
U.S. state
In the United States, a state is a constituent political entity, of which there are 50. Bound together in a political union, each state holds governmental jurisdiction over a separate and defined geographic territory where it shares its sover ...
s to only raise the
speed limit
Speed limits on road traffic, as used in most countries, set the legal maximum speed at which vehicles may travel on a given stretch of road. Speed limits are generally indicated on a traffic sign reflecting the maximum permitted speed - expres ...
on their rural interstates from 55 mph (ca. 90 kmh) to 65 mph (ca. 105 kmh), Greenstone and
Orley Ashenfelter
Orley Clark Ashenfelter (born October 18, 1942) is an American economist and the Joseph Douglas Green 1895 Professor of Economics at Princeton University. His areas of specialization include labor economics, econometrics, and law and economics. H ...
compare the time saved due to the increase in speed limit with the increase in fatality rates (an increase of ca. 35%) to estimate the
value of a statistical life
The value of life is an economic value used to quantify the benefit of avoiding a fatality. It is also referred to as the cost of life, value of preventing a fatality (VPF), implied cost of averting a fatality (ICAF), and value of a statistical li ...
. They find that approximately 125,000 hours were saved per lost life, suggesting (if hours saved are valued at the average hourly wage) an upper bound of $1.54 million (in 1997 U.S. dollars) as a value of a statistical life.
Finally, Greenstone,
Paul Oyer and Annette Vissing-Jorgensen use the extension of mandatory disclosure requirements under the 1964 Securities Acts Amendments from listed stock to
over the counter
Over-the-counter (OTC) drugs are medicines sold directly to a consumer without a requirement for a prescription from a healthcare professional, as opposed to prescription drugs, which may be supplied only to consumers possessing a valid prescr ...
(OTC) stock trades on stock returns. They find that the announcement of compliance with disclosure requirements by those OTC firms most likely to be affected by the change in regulation was accompanied by abnormal excess stock returns of ca. 3.5% in the weeks surrounding the announcement and that expectations regarding the extension of regulations resulted in abnormal excess returns ranging from 11.5 to 22.1% in the period between legislative proposal and enforcement, suggesting large-scale insider trading at OTC firms.
Current Work
Greenstone’s research has influenced policy domestically and internationally. His current work involves testing innovative ways that aim to increase developing countries' energy access and improve the efficiency of environmental regulations across the world. Greenstone is a co-director of the Climate Impact Lab where he is producing numerically-based estimates of the local and global impacts of climate change. Further, he developed the Air Quality Life Index™ that converts air pollution concentrations into their impact on life expectancy and co-founded Climate Vault, a 501(c)(3) that uses markets to allow institutions and people to reduce their carbon footprint.
References
External links
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{{DEFAULTSORT:Greenstone, Michael
Living people
21st-century American economists
20th-century American economists
Environmental economists
American development economists
Health economists
Swarthmore College alumni
Princeton University alumni
University of Chicago faculty
Fellows of the Econometric Society
Fellows of the American Academy of Arts and Sciences
1976 births
Journal of Political Economy editors