Association for Public Policy Analysis & Management

The flagship air pollution control program in Mexico City named Hoy No Circula (roughly translated as Today Your Car Stays Put) regulates the frequency in which motor vehicles can be used in the city from Monday to Saturday based on a biannual vehicle-emissions checkup. Such mandate was first implemented in November 1989, then changed in June 2014 from the emissions-based standard to vehicles’ age regulation, and changed again to its original form in July 2015. It can be argued that neither of the two policy changes responded to shifts in the trends of air pollution concentrations in the city, but rather to increased levels of corruption in the emissions checkup centers in 2014, and to judicial contentions about the new ruling in 2015, making them exogenous policy changes. The goal of this paper is to conduct an impact evaluation of Hoy No Circula over Mexico City’s air quality, and over private vehicles usage at its three relevant moments in time: its first implementation (1989), and the two policy changes (2014, and 2015). Past studies used interrupted time-series to show that the program, when first implemented, was relatively ineffective for reducing pollution, however it substantially increased the size of the vehicle fleet in the city, offsetting environmental quality improvements. While the effects are consistent in the short run, in the longer run they remain elusive. This research builds upon those studies by using several difference-in-differences specifications with alternative controls, and spatial correlations components, thus providing a more robust quasi-experimental design that also addresses potential spatial confounders that are inherent to ambient data. In addition, this research looks at the program’s first implementation, but also at the latest two policy changes that have not been subject to evaluation. For Hoy No Circula’s first implementation, preliminary results show statistically significant decreases in CO and O₃ concentrations in the short run, and increases in the middle/long run, however these effects are not significant for NO_X, or SO₂. For the policy change of 2014, I hypothesize that the concentrations of criteria pollutants will decline since a significant proportion of vehicles will face a restriction regardless of their emission level. However, it is likely that vehicle users will adjust to the ruling change by either acquiring additional vehicles, or by increasing driving on the allowed days, offsetting the potential emissions reductions. Finally, for the 2015 policy change, I hypothesize that concentrations of criteria air pollutants will increase due to the program’s return to its original ruling, where the restriction affects a smaller number of vehicles, however with a potentially larger total vehicle fleet due to vehicle users’ adjustment to the 2014 policy change.