Sugar cane burning and human health : an analysis using spatial difference in difference

The production of ethanol and sugar from sugar cane has sharply increased for the last 20 years. If there are overall incentives to substitute the consumption of fossil fuels by biofuels, the increase of production and the expansion of new cultivated areas of sugar cane have eventually an impact on human health and employment mainly at regional levels. To harvest the crop-mostly manually done by low-skill workers-the practice of burning to clean dry grasses and poisonous insects has been executed for years during the dry season, what increase the productivity of workers. However, the burning generates a massive quantity of smoke that spread in the region reaching cities and becoming a potential threat to the human health. The main objective of this paper is to investigate the impact of the burning prohibition of sugar cane on respiratory problems of children, teenagers and elderly people. This analysis proposes a spatial difference-in-difference technique, to control the effect of treatment (the sugarcane culture) over the untreated regions, closest to producing regions. We consider also other control variables such as workforce, income, proportion of woman, elderly and young people in the population, and a time trend variable, to control institutional changes. The data used in this study corresponds to a balanced panel of 644 municipalities from 2002 to 2011.