Introduction

Air pollution has emerged from a localized environmental problem into a transnational problem with enormous economic and health impacts on developing economies like India. Air pollution breeds negative externalities for society: the cost is borne not by the polluter but by society. Thus indicative of a market failure.

The Lancet Report 2024 stated that more than 6.7 million premature deaths worldwide occur annually due to air pollution. India has to bear the most disproportionate burden with more than 1.7 million premature deaths occurring each year. Such health outcomes incur some serious economic costs. According to estimates by the Asian Development Bank (ADB), Indian air pollution contributes around $36 billion towards the annual damages in terms of lost productivity and increased healthcare and premature mortality-expressed as equivalent to 3.1 percent of its GDP. This is not only through the direct cost of human capital deterioration.

Economic implications of air pollution in cities like New Delhi, which constantly feature on the world’s list of most polluted cities, are at their peak. Both the State of Global Air Report 2024 and IQAir 2024 World Air Quality Report confirm that the annual PM_2.5 concentration in New Delhi is eight times higher than the WHO limit, which creates a serious threat to respiratory and cardiovascular health, thus lowers the productivity of the workforce. The empirical evidence suggests that exposure to a high dose of particulate matter significantly depressed both cognitive and physical performance, which further declines labour productivity. According to a paper from the Indian Institute of Management Ahmedabad (IIMA), air pollution alone decreased India’s GDP growth rate by as much as 0.5–1 percent annually, thereby increasing economic costs from lost human capital and missed workdays.

The economic cost for India in fighting air pollution is evident. Cutting air pollution will have far-reaching effects beyond better public health, it will also generate substantial economic benefits. According to a report in The Lancet 2024, a 10 percent reduction in global air pollution could prevent millions of deaths and generate significant savings in the economy. For India, all these savings would come in terms of increased labor productivity, reduced health costs, and an efficient labor force-all channeled into the long-term growth path. There is thus a good economic reason to invest in cleaner technologies, better public transport mechanisms, and stringent regulatory approaches.

The “Odd-Even” vehicle restriction scheme in Delhi may not have been very effective to check pollution as there are several sources of pollution from industries, agricultural residue burnings, and vehicular emissions. A better solution would be to combine market-based solutions such as carbon pricing or cap-and-trade systems, with stricter enforcement of air quality standards. This also includes the transnational nature of pollution, in particular, that of cross-border industrial emissions and agricultural practices. Regional cooperation amongst South Asian nations to create collective policy frameworks as well as benchmarks will serve this purpose.

Literature review

Air pollution remains one of the most pressing public health challenges in urban areas across the globe, with New Delhi as the world’s most polluted capital city (Global Air Quality Report: IQAir). As urban population swells and industrial activities intensify, air quality continues to deteriorate, leading to severe health consequences. According to the World Health Organization (WHO), air pollution is linked to over 7 million premature deaths annually worldwide, with Delhi bearing the brunt of the burden in India (WHO, 2016). Air pollution in Delhi is primarily driven by vehicular emissions, industrial pollutants, and agricultural practices such as stubble burning in neighboring states like Punjab and Haryana.

Studies by Sharma et al. (2018) have revealed that pollutants such as nitrogen dioxide (${\text{NO}}_2$), sulfur dioxide (${\text{SO}}_2$), ozone (${\text{O}}_3$), and particulate matter (PM) are rampant in Delhi’s atmosphere, contributing to severe health conditions, including respiratory and cardiovascular diseases. These pollutants have reduce life expectancy in the capital, with estimates indicating that Delhiites lose an average of 9.7 years of their life due to poor air quality (Gandhiok, 2021). The gravity of this issue is underscored by data from the University of Chicago, which highlights the geographical spread of pollution, negatively impacting the health of millions across India (Greenstone et al., 2021).

The emissions of CO and NOx due to personal cars (PCs) are found to be about 34 percent and 50 percent respectively, and the emission of CO due to 2 W (2- Wheeler) is about 61 percent. The analysis of fuel-wise emission of pollutants reveals that CO is mainly emitted by petrol vehicles, whereas NOx and PM are emitted by diesel vehicles. It is also noticeable that CO, NOx and PM emissions at ITO, one of the busiest traffic intersections of Delhi, are approximately 15, 6 and 0.5 tons/day respectively, which are found to be the maximum followed by Kashmiri Gate (ISBT), and Nizamuddin (Goyal, P., et al, 2013). Additionally, it was found that Delhi had 1.7 times the prevalence of respiratory symptoms (in the past 3 months) compared with rural controls (P < 0.001); the odds ratio of upper respiratory symptoms in the past 3 months in Delhi was 1.59 (95 percent CI 1.32–1.91) and for lower respiratory symptoms (dry cough, wheeze, breathlessness, chest discomfort) 1.67 (95 percent CI 1.32–1.93) (Rizwan, S., et al, 2013). The gravity of the matter is highlighted by the severe and unprecedented health risks in the capital.

In response to this rising crisis, the government has taken various measures to reduce the levels of pollution, among which the odd-even traffic rationing scheme has been one of the most popular and replicable schemes across cities and countries. The odd-even policy was thought of as a short-term measure for managing traffic; it imposed restrictions on the use of private vehicles depending on whether the last digit of their number plates falls under odd or even numbers. Although conceptualized as a stop gap measure, the practice has given a clear view of its practicality in curbing vehicular emissions and thus effectively reducing the percentage of pollutants in the atmosphere.

The idea of rationing traffic was first applied extensively during the “Hoy No Circula” scheme implemented in Mexico City from 1989 onwards, when vehicles with odd and even number plates were allowed to run only on alternate days. Although this initiative resulted in short-term air quality improvements, it faced long-term challenges, such as an increase in the number of vehicles purchased by households to circumvent the policy, which ultimately exacerbated pollution levels (Down to Earth, 2015). Similar issues were observed in Bogotá, Colombia, where the policy showed promise in the short run, but its impact diminished over time as people adapted by acquiring additional vehicles.

Beijing, China, enforced the odd-even policy before the 2008 Olympic Games. During the implementation period, pollution decreased by 20 percent. It showed that such a measure could be effective for reducing vehicular emissions. However, when the policy was lifted post-Games, pollution levels rapidly rebounded, signaling the need for more comprehensive and sustainable solutions (Down to Earth, 2015). In Paris, the policy was enforced during high smog episodes in 2015, but while it temporarily reduced pollution, the long-term effectiveness of such a scheme has been questioned.

Delhi’s own experiment with the odd-even scheme, first introduced in 2016, sought to address the capital’s severe air quality crisis. The Central Pollution Control Board (CPCB) reported a decrease in pollutants during the period when the policy was enforced, particularly nitrogen oxides (NOx) and carbon monoxide (CO), which are major contributors to vehicular pollution (CPCB, 2016). However, the short-lived success of the policy in Delhi also highlighted challenges such as insufficient public transportation infrastructure, which left many residents without viable alternatives to private vehicle use.

The effectiveness of the odd-even scheme has also been studied by a number of researchers with mixed findings. For instance, Garg and Gupta (2020) found a pronounced decrease in pollution levels during the implementation of the policy in Delhi but mentioned that other measures like the improvement of public transport and better enforcement of emission norms must be combined with the odd-even scheme. Similarly, Rizwan et al. (2013) concluded that despite a temporary decrease in vehicular emissions due to an odd-even policy, industrial emissions, construction dust, and stubble burning continue to pollute the air.

Despite its widespread research, the long-term effectiveness and citizen-oriented outcomes of the odd-even policy remains largely under-researched. While there have been numerous evaluations of its short-term impact on air quality, there is a dearth of studies that investigate how such policies could be integrated into broader, sustainable air pollution control strategies. Recent studies by Singh et al. (2020) and Mehta and Kumar (2021) underscore the need to explore not only the temporary effects of traffic rationing but also the long-term health outcomes and socio-economic implications, particularly for low-income groups who may be disadvantaged by such policies.

Furthermore, Aitalieva et al. (2019) highlights the importance of citizens’ perceptions in shaping the success of government policies, indicating that public opinion and citizen satisfaction are crucial factors in evaluating the effectiveness of governmental actions. Additionally, they indicate that within countries, citizens’ perceptions of government policy success are largely influenced by individual sociodemographic attributes and political attitudes. This suggests that while individual citizens’ views are important, the broader context of public institutions and economic stability also greatly influences how citizens perceive the success of government policies.

This paper seeks to fill these gaps by providing a statistical overview of the pollutant quantity pre and post the vehicular experimentation in New Delhi. The study will also evaluate the citizen perception associated with air pollution reduction during periods of traffic rationing, providing a more holistic understanding of the policy’s benefits and limitations.

The odd-even traffic rationing scheme has been implemented with varying degrees of success in cities around the world. While it offers short-term relief from vehicular emissions and improves air quality during its enforcement, the policy alone is insufficient to tackle the complex, multifaceted problem of air pollution. This paper’s exploration of the impacts of the odd-even policy in a rapidly developing country, its social equity implications, and the potential for its integration into broader air quality management strategies will contribute valuable insights to both local and global policymaking efforts aimed at improving urban air quality. By addressing the research gaps related to the sustainability and comprehensiveness of such measures, this study will provide a nuanced understanding of the role of traffic rationing policies in the broader context of air pollution control and public health improvement.

Materials and methodology

Result and discussion

Primary pollutants

Secondary pollutants

O₃

No statistical difference was observed in ozone levels for the Odd-Even period. Ozone is a secondary pollutant formed through photochemical reactions with some precursors, mainly NOx and VOCs. Since the Odd-Even scheme targets emissions from vehicles, which are precursors to ozone formation, the lack of significant change in ${\text{O}}_3$ levels indicates that the effect of the policy concerning secondary pollutants may be constrained and also influenced by multiple factors, including meteorology and precursor emissions from non-vehicular sources, such as climatic factors and industrial emissions.

Table 1:

welch’s t test result of primary and secondary pollutants

POLLUTANT	OBSERVATION	MEAN		STANDARD ERROR	STANDARD DEVIATION
PM2.5	Ha: diff < 0 Pr(T < t) = 0.0048		Ha: diff ! = 0 Pr(|T| > |t|) = 0.0095		Ha: diff > 0 Pr(T > t) = 0.9952
PRE ODD EVEN	10	85.5		11.09	35.1
DURING ODD EVEN	10	126		8.57	27.1
BENZENE	Ha: diff < 0 Pr(T < t) = 0.5352		Ha: diff ! = 0 Pr(|T| > |t|) = 0.9259		Ha: diff > 0 Pr(T > t) = 0.4648
PRE ODD EVEN	5	5.6		3.4	7.6
DURING ODD EVEN	5	5.2		2.8	6.2
NO2	Ha: diff < 0 Pr (T < t) = 0.0577		Ha: diff ! = 0 Pr (|T| > |t|) = 0,1153		Ha: diff > 0 Pr (T > t) = 0.9423
PRE ODD EVEN	15	50.33		4.65	18.01
DURING ODD EVEN	15	62		5.48	21.22
SO2	Ha: diff < 0 Pr (T < t) = 0.1138		Ha: diff ! = 0 Pr (|T| >| t |) = 0.2276		Ha: diff > 0 Pr (T > t) = 0.8862
PRE ODD EVEN	15	16.53		3.43	13.31
DURING ODD EVEN	15	22.46		3.37	13.06
CO	Ha: diff < 0 Pr (T < t) = 0.0670		Ha: diff ! = 0 Pr (|T| > |t)|) = 0.1339		Ha: diff > 0 Pr (T > t) = 0.9330
PRE ODD EVEN	6	891.16		127.23	311.67
DURING ODD EVEN	6	1333.83		235.86	577.74
O3	Ha: diff < 0 Pr (T < t) = 0.1398		Ha: diff ! = 0 Pr (|T| > |t|) = 0.2796		Ha: diff > 0 Pr (T > t) = 0.8602
PRE ODD EVEN	5	58.8		11.52	25.76
DURING ODD EVEN	5	78.4		12.68	28.36

Figure 1:

Box plot comparison of PM_2.5 before and during Odd-Even

Medium to Long-Term Implications

The rapid urbanization and population growth in Delhi, coupled with the rising demand for mobility, present significant challenges to the long-term success of the Odd-Even policy. According to projections by the Delhi Transport Department, the number of vehicles on Delhi’s roads was expected to exceed 10 million by 2020, with vehicle ownership continuing to increase at an annual rate of 5–6 percent. The fact that the growth of vehicles during the Odd-Even period was accelerated by a 7 percent increase in registrations indicates that this policy has shifted short-term behavior, not changed long-term usage permanently. This likely does not translate into a decreased vehicle density and therefore the reduction in emissions was not maintained long term.

The Odd-Even policy provided a short-term respite, its high exemption rate along with rapid growth in vehicles and scarce road space undermined it considerably toward any long-term basis of success in solving congestion-related issues and air pollution. A more holistic and sustainable approach aimed at tackling the root causes of vehicular growth and congestion would be required to bring about long-term benefits to air quality and urban mobility.

Figure 2:

Box plot comparison of $N{O}_2$ before and during Odd-Even

Figure 3:

Box plot comparison of $S{O}_2$ before and during Odd-Even

Figure 4:

Box plot comparison of CO before and during Odd-Even

Figure 5:

Box plot comparison of $O_3$ before and during Odd-Even

B. Survey

Support for reimplementation of the Odd-Even policy is influenced by several factors. A positive prior experience with the scheme notably motivates individuals to support its reintroduction. Furthermore, ownership of two-wheelers significantly influences support, likely because two-wheelers were exempt during the policy’s initial rollout. A large majority of the population recognizes air pollution as a pressing issue, and this shared concern aligns with widespread support for the policy’s reimplementation. Individuals who perceive the Odd-Even policy as effective are more likely to advocate for its return. Moreover, those with multiple vehicles, particularly those who own both cars and two-wheelers, tend to express greater support for the policy compared to those reliant on public or alternative transportation during vehicle off days. These findings suggest that individual experiences and vehicle ownership play crucial roles in shaping attitudes toward the Odd-Even scheme. Falling within the exemption category made individuals more likely to comply.

Table 2: Number of cars and desire for reimplementation of Odd-Even policy

How Many cars do you have?	Should Odd-Even policy be implemented again? Maybe No Yes			Total
l	26	34	105	165
2	7	17	51	75
3	2	9	25	36
More than 3	1	2	4	7
None	42	39	61	142
Total	78	101	246	425

The Odd-Even policy is similar to a coordination game, where individuals are deciding on the basis of expectations of others’ behavior. In terms of discounts, vehicle owners faced an option: either to follow restrictions or to find loopholes to evade. Given the exemptions and the large number of unaffected vehicles, many owners bought additional vehicles to circumvent the restrictions. This behavior can be understood as a Nash equilibrium, where every player’s strategy (buying more vehicles) is optimal given the strategies of others (using discounts and ignoring the policy). Consequently, second-hand vehicle sales increased, and a free-rider problem emerged on the days of restrictions. Four-wheeler sales reached 8,298 vehicles, an increase from 7,679 vehicles sold during the same period in the previous four years. These data support the argument that the policy inadvertently stimulated vehicle purchases as individuals sought to evade restrictions, suggesting that a policy intended to reduce vehicles on the road instead led to a surge in vehicles, particularly second-hand ones.

Figure 6:

Rating air pollution on a scale of 1 to 5

Table 3: Effect of air pollution in individual’s life by age

What is your age?	Does Air Pollution affect your life?			Total
	Maybe	No	Yes
18 to 28	13	3	124	140
28 to 38	0	5	44	49
38 to 48	2	12	36	50
48 to 58	0	18	67	85
58 to 68	0	15	40	55
More than 58	0	6	40	46
Total	15	59	351	425

Figure 7:

Does air pollution affect your life?

Table 4: Two-wheelers and reimplementation of policy

Do you have any two-Wheelers	Should odd-Even policy be implemented again?			Total
	Maybe	No	Yes
No	41	56	65	162
Yes	37	45	181	263
Total	78	101	246	425

Figure 8:

Should Odd-Even be implemented again?

Conclusion

The study provides an in-depth economic analysis of the Odd-Even policy in Delhi through the lenses of public economics, behavioral economics, and environmental economics, through the lenses of public economics, behavioral economics, and environmental economics, in Delhi. From a public economics perspective, the Odd-Even policy aims to address the market failure of air pollution — a classic negative externality. Air pollution imposes substantial social costs health expenditures, lost productivity, and environmental degradation. This divergence between private and social costs results in overproduction of pollution of pollution. The Odd-Even plan, designed as a command-and-control regulatory intervention, sought to reduce these externalities by limiting the emissions of vehicles. However, the results suggest that the policy has limited success in addressing pollution. Pollutants such as ${\text{SO}}_2$, ${\text{NO}}_2$, $\text{CO}$, and benzene did not show statistically significant reductions, while PM_2.5 levels increased during implementation. This suggests that policy effectiveness is constrained by factors such as behavioral responses and partial nature of intervention. In cost-benefit terms, the social cost of pollution is not adequately internalized by the policy alone, questioning the scalability and stability of such regulatory measures for long-term environmental reforms. From the point of view of behavior economics, asymmetrical policy underlines the important importance of understanding individual decisions under constraints and incentives. The policy design did not account for the strategic behavior of car owners, who could exploit exemptions and buy additional vehicles. This creates a coordination game in which individuals act in their own self-interest, deciding on the basis of the anticipated behavior of others. According to Nash equilibrium, each vehicle owner’s strategy of buying an additional vehicle to maintain mobility becomes optimal when others do the same. This response exacerbates pollution rather than reducing it, as evidenced by the increase in vehicle ownership during implementation of the policy. The free-rider problem is also evident: individuals buy additional vehicles to avoid compliance, creating an externality generated by the very policy designed to reduce pollution. This behavioral response highlights the limitations of the Odd-Even policy, which fails to account for individuals’ inability to fully internalize the social costs of their actions. In addition, the economic theory of market failure and principal-agent problem also provides insight into the shortcomings of policy. The policy suffered from moral hazard and adverse selection, as individuals were left to self-regulate without adequate enforcement through individual compliance without adequate enforcement mechanisms, where individuals, acting as rational agents, reduced individual discomfort at the cost of collective good. sought to. Failure to impose sufficient costs for non-compliance reduced the policy’s effectiveness in reducing pollution. According to projections by the Delhi Transport Department, the number of vehicles on Delhi’s roads was expected to exceed 10 million by 2020, with vehicle ownership continuing to increase at an annual rate of 5–6 percent. The fact that the growth of vehicles during the Odd-Even period was accelerated by a 7 percent increase in registrations indicates that this policy has shifted short-term behavior, not changed long-term usage permanently. This likely does not translate into a decreased vehicle density and therefore the reduction in emissions was not maintained long term.

From an environmental economics perspective, the results suggest that the Odd-Even policy’s narrow focus on restricting vehicular emissions was inadequate to address the wider scope of pollution. While vehicle emission are an important contributor to deteriorating urban air quality, the policy ignores other major sources, such as industrial emissions, manufacturing, and crop burning. The lack of a significant decrease in PM_2.5 levels and other pollutants reflects the importance of a holistic approach to environmental regulation. A policy mix combining regulatory measures for industrial emissions, incentives for cleaner technologies, and investment in public transport infrastructure is necessary to achieve meaningful improvement in air quality. As the Case theorem suggests, environmental externalities may be addressed more effectively through well-defined property rights and market-based solutions such as cap-and-trade systems or pollution taxes, Market-based instruments can sometimes achieve pollution reduction more efficiently than command-and-control regulations alone.

The study also reveals significant insights into public opinion regarding the behavioral effects of the Odd-Even policy. While the policy has faced challenges in terms of its direct environmental results, it has promoted a public awareness about the pollution crisis, which can serve as a basis for more effective intervention in the future. A significant proportion of individuals expressed support for reimplementation of the policy, especially those who had a positive experience during its early stages. This suggests that public support is influenced not only by policy effectiveness but also by individual experiences and perceived success. These findings align with prospect theory, which highlights that individuals weigh positive experiences more heavily than negative ones, shaping their willingness to support future interventions. Additionally, individuals who owned multiple vehicles were more likely to support reimplementation, suggesting that those with higher private costs were more invested in maintaining the policy.

Finally, while the Odd-Even policy raised awareness and garnered some public support, its effectiveness in addressing Delhi’s severe pollution crisis remains limited. The policy’s failure to significantly reduce key pollutants and its unintended effect on vehicle ownership highlight the need for broader, longer-term solutions that integrate economic encouragement with environmental regulation. The structure of high density areas specially with less geographical area require exemptions but these make the policy ineffective. For successful implementation, either population density must be lower or the implementation area larger. The vehicular rationing policy is not effective in the Global South. A combination of market-based instruments (such as carbon taxes and tradable permits) and behavioral interventions (such as clean energy subsidies and public transport subsidies) would be more sustainable for developing and developed countries with high population densities.

Ultimately, the limits of the policy underlying the requirement for a broad and more integrated approach to urban air quality management, that combines regulatory measures with incentives, taking into account both environmental and economic factors. Without this type of innings, the odd policy would be a temporary measure with limited long -term effectiveness in reducing Delhi’s air pollution crisis.

Grant Support Details

The present research did not receive any financial support.

Conflict of Interest

The author declares that there is no conflict of interests regarding the publication of this manuscript. In addition, the ethical issues, including plagiarism, informed consent, misconduct, data fabrication and/or falsification, double publication and/or submission, and redundancy have been completely observed by the author.

Life Science Reporting

No life science threat was practised in this research.