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Labor market impacts of U.S. tight oil development: The case of the Bakken

Dragan Miljkovic () and David Ripplinger

Energy Economics, 2016, vol. 60, issue C, 306-312

Abstract: There has been a recent boom in natural gas and oil production in the US due to high energy prices and technological advances in hydraulic fracturing and horizontal drilling. While North Dakota oil production has increased significantly since 2005 with the development of Bakken formation, the impact on the rest of the economy including agriculture, historically the largest industry in North Dakota, has received little attention. We employ a variant of the Corden-Neary resource development model to test the impact of the oil boom in North Dakota caused by technical change on employment and wages in two tradable sectors of the state economy: agriculture and energy, alongside the rest of the state's economy, using a Vector Error Correction (VEC) model marking the very first use of the dynamic vector autoregression (VAR) analysis in this theoretical framework.

Keywords: Energy boom; Oil; Labor market; Employment; Wages; Natural resource curse; Dutch disease (search for similar items in EconPapers)
JEL-codes: Q43 Q48 J23 J43 C32 O13 (search for similar items in EconPapers)
Date: 2016
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