Low depression zones? : the effect of driving restrictions on air pollution and mental health

Does exposure to air pollution impact mental health? This paper uses administrative health insurance data to estimate the long-term cumulative effects of air pollution exposure on mental health outcomes. For identification, we exploit the staggered introduction of Low Emission Zones (LEZs) across German cities, which restrict access for emission-intensive vehicles. We find that LEZs reduce various air pollutants and improve the population's mental health measured by depression and anxiety diagnoses, prescriptions, and specialist visits. The health benefits emerge gradually, with younger individuals benefiting the most. Our findings suggest substantial mental health co-benefits and avoided health costs from improved air quality