Better safe than sorry? Evidence from Lanzhou's driving restriction policy

- This paper evaluates the effects of driving restriction policy on air pollution in one of the most polluted cities in China.
- A regression discontinuity design approach is employed on hour-by-station measurements of air pollutants.
- Driving restriction policy fails to improve air quality in Lanzhou.
- Discuss the potential pathways for circumventing driving restriction policy

Driving restriction policies (DRPs) have been adopted worldwide to curb traffic congestion and air pollution. However, the empirical evidence of the effectiveness of such policies in improving air quality remains mixed (e.g., Davis, 2008; Viard & Fu, 2015). Individuals may change their commute schedules/routes or hire/purchase additional vehicles to circumvent such restrictions. This paper addresses this possibility by utilizing hourly measurements of air pollutants from monitoring stations at Lanzhou, one of the most polluted cities in China. Utilizing a regression discontinuity design (RD) approach, we concluded that the driving restrictions in Lanzhou are ineffective in improving its air quality. Specific hour and location results suggest that drivers shift their travel schedules, take detours, and acquire alternative vehicles. The results are robust after considering alternative model specifications and sample restrictions.