Summary. We document the main risk factors that determine children's exposure to passive smoke, and we use econometric techniques to provide a new economic quantification of the effect of this exposure on child health. One of our main contributions is the use of a large nationally representative sample of children drawn from the Health Survey for England, for whom we match parental and household smoking and demographic characteristics. We use an objective measure of children's exposure, namely the level of cotinine in their saliva. We find that both parental and child carer smoking behaviour are major risk factors in determining children's exposure to passive smoke. For a child who is exposed to a high number of passive smoking risk factors, the income equivalence of such exposure is £16000 per year. Finally, comprehensively controlling for child passive smoking does not explain the observed gradient between household income and parental-reported child health in England.