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The Employment Impact of Green Fiscal Push: Evidence from the American Recovery Act

Author

Listed:
  • David Popp
  • Francesco Vona

    (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po)

  • Giovanni Marin

    (Università degli Studi di Urbino 'Carlo Bo')

  • Ziqiao Chen

Abstract

We evaluate the employment effect of the green part of the largest fiscal stimulus in recent history, the American Recovery and Reinvestment Act (ARRA). Each $1 million of green ARRA created 15 new jobs that emerged especially in the post-ARRA period (2013-2017). We find little evidence of significant short-run employment gains. Green ARRA creates more jobs in commuting zones with a greater prevalence of pre-existing green skills. Nearly half of the jobs created by green ARRA investments were in construction or waste management. Nearly all new jobs created are manual labor positions. Nonetheless, manual labor wages did not increase.

Suggested Citation

  • David Popp & Francesco Vona & Giovanni Marin & Ziqiao Chen, 2020. "The Employment Impact of Green Fiscal Push: Evidence from the American Recovery Act," Working Papers hal-03403066, HAL.
    • Handle: RePEc:hal:wpaper:hal-03403066
    Note: View the original document on HAL open archive server: https://sciencespo.hal.science/hal-03403066
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    References listed on IDEAS

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    1. Francesco Vona & Giovanni Marin & Davide Consoli & David Popp, 2018. "Environmental Regulation and Green Skills: An Empirical Exploration," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 5(4), pages 713-753.
    2. Francesco Vona & Giovanni Marin & Davide Consoli & David Popp, 2018. "Environmental Regulation and Green Skills: An Empirical Exploration," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 5(4), pages 713-753.
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    6. Joseph E. Aldy, 2013. "Policy Monitor A Preliminary Assessment of the American Recovery and Reinvestment Act's Clean Energy Package -super-1," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 7(1), pages 136-155, January.
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    Cited by:

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    3. Ziqiao Chen & Giovanni Marin & David Popp & Francesco Vona, 2020. "Green Stimulus in a Post-pandemic Recovery: the Role of Skills for a Resilient Recovery," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 76(4), pages 901-911, August.
    4. Jean-Luc Gaffard, 2022. "Instabilité et résilience des économies de marché: Essai sur l'économie du libéralisme social," GREDEG Working Papers 2022-33, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France.
    5. Taheripour,Farzad & Chepeliev,Maksym & Damania,Richard & Farole,Thomas & Lozano Gracia,Nancy & Russ,Jason Daniel, 2021. "Putting the Green Back in Greenbacks : Opportunities for a Truly Green Stimulus," Policy Research Working Paper Series 9742, The World Bank.
    6. Moszoro Marian W., 2024. "The direct employment impact of public investment," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 60(1), pages 59-74, March.
    7. Jean-Luc Gaffard, 2021. "La transition écologique : incertitude, irréversibilité et modèle institutionnel," GREDEG Working Papers 2021-04, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France, revised Feb 2021.
    8. Graziano, Marcello & Alexander, Karen A. & McGrane, Scott J. & Allan, Grant J. & Lema, Evangelia, 2022. "The many sizes and characters of the Blue Economy," Ecological Economics, Elsevier, vol. 196(C).
    9. Mireille Chiroleu-Assouline, 2022. "Rendre acceptable la nécessaire taxation du carbone. Quelles pistes pour la France ?," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(1), pages 15-53.
    10. Angela Köppl & Margit Schratzenstaller, 2022. "Macroeconomic Effects of Green Recovery Programmes. Conceptual Framing and a Review of the Empirical Literature," WIFO Working Papers 646, WIFO.
    11. Imaduddin Abdullah & Dallih Warviyan & Rika Safrina & Nuki Agya Utama & Andy Tirta & Ibham Veza & Irianto Irianto, 2023. "Green Fiscal Stimulus in Indonesia and Vietnam: A Reality Check of Two Emerging Economies," Sustainability, MDPI, vol. 15(3), pages 1-15, January.
    12. Ara Jo & Christos Karydas, 2023. "Firm Heterogeneity, Industry Dynamics and Climate Policy," CER-ETH Economics working paper series 23/378, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    13. Aldy, Joseph E., 2022. "Learning How to Build Back Better through Clean Energy Policy Evaluation," RFF Working Paper Series 22-15, Resources for the Future.
    14. Raimi, Daniel & Greenspon, Jacob, 2022. "Matching Geographies and Job Skills in the Energy Transition," RFF Working Paper Series 22-25, Resources for the Future.
    15. Andrew, Kevin & Majerbi, Basma & Rhodes, Ekaterina, 2022. "Slouching or speeding toward net zero? Evidence from COVID-19 energy-related stimulus policies in the G20," Ecological Economics, Elsevier, vol. 201(C).
    16. Filipović, Sanja & Lior, Noam & Radovanović, Mirjana, 2022. "The green deal – just transition and sustainable development goals Nexus," Renewable and Sustainable Energy Reviews, Elsevier, vol. 168(C).
    17. Hillberry, Russell & Nguyen, Nhu, 2022. "Renewable resource rents, taxation and the effects of wind power on rural economies," Conference papers 333477, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    18. Luigi Aldieri & Jonas Grafström & Concetto Paolo Vinci, 2021. "The Effect of Marshallian and Jacobian Knowledge Spillovers on Jobs in the Solar, Wind and Energy Efficiency Sector," Energies, MDPI, vol. 14(14), pages 1-16, July.
    19. Zachariadis,Theodoros & Giannakis,Elias & Taliotis,Constantinos & Karmellos,Marios & Fylaktos,Nestor & Howells,Mark Idwal & Blyth,William James & Hallegatte,Stephane, 2021. ""Building Back Better" in Practice: A Science-Policy Framework for a Green Economic Recovery after COVID-19," Policy Research Working Paper Series 9528, The World Bank.

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    More about this item

    Keywords

    Employment effect; Green subsides; American Recovery Act; Heterogeneous effect; Distributional impacts;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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